Background. The renal allograft biopsy is generally accepted as the gold standard for clarifying the cause of renal dysfunction. However, the clinical usefulness of this procedure has rarely been studied prospectively, nor have most studies included follow-up of patients to delineate the influence of the biopsy on clinical outcome. In this study, we evaluated prospectively the clinical usefulness of the allograft biopsy in renal transplant recipients receiving cyclosporine (CyA). Methods. During a 21-month period, 82 biopsies were performed. In 54 instances (47 patients), we outlined a presumed diagnosis and tentative treatment plan before the procedure. After the biopsy, a definitive diagnosis was made and an appropriate patient management approach was instituted. We analyzed the incidence of change in patient management that resulted from histological findings. All patients were followed to monitor their response to treatment and allograft survival. In cases of biopsy-proven acute cellular rejection (ACR) or cyclosporine (CyA) toxicity, clinical and laboratory data from the day of the biopsy were reviewed to determine their diagnostic value. Results. One biopsy specimen was inadequate for definitive interpretation. The biopsy findings resulted in a change in patient management in 22 (41.5%) of the remaining 53 cases (change group). The incidence of altered patient management was 38.7% in biopsy specimens taken in the first month, 55.6% between 1 and 12 months, and 38.5% after 1 year posttransplantation. A change in management was required in 2 of 2 patients with chronic allograft dysfunction, in 44.4% of the 45 patients with acute allograft dysfunction, and in none of the patients with delayed graft function (n=6). Within the first week of treatment 19 of 22 (86.4%) in the change group and 25 of 31 (80.6%) in the no change group had a positive response to therapy. The 1-year allograft survival rate was also similar between the two groups. None of the clinical and laboratory data was useful in distinguishing ACR from CyA toxicity. Conclusions. Renal allograft biopsy findings alter patient management recommendations in approximately 40% of patients in whom a presumptive diagnosis had been made on the basis of clinical and laboratory findings. Patients who had a change in patient management because of biopsy findings demonstrated a response to therapy and allograft survival similar to those of patients who had no alteration in management plan after the biopsy.