Background: Patients with cholestatic liver function tests and histological features of primary sclerosing cholangitis (PSC) but a normal cholangiogram are considered to have small duct PSC. The natural history of this condition is unknown. Methods: Thirty three patients with small duct PSC were identified among patients admitted for diagnostic workup of cholestatic liver function tests in one centre in the UK (Oxford) and one centre in Norway (Oslo). A total of 260 patients with large duct PSC were compared, and prognosis in terms of death, cholangiocarcinoma, biochemical features, histological features, and symptoms analysed. Results: Mean age at diagnosis was 38 years and 39 years in small duct and large duct PSC, respectively. Mean follow up was 106 months in small duct and 105 months in large duct patients. Four patients originally considered to have small duct developed large duct PSC. Two of these underwent liver transplantation during follow up. Of the remainder who did not develop large duct PSC, two patients died during follow up: one of liver failure and the other of cardiac death unrelated to her liver disease. A total of 122 (47%) large duct patients either required liver transplantation (34 patients) or died (88 patients). Small duct patients had a significantly better survival compared with large duct patients. Among small duct patients, none developed cholangiocarcinoma compared with 28 of 260 (11%) large duct patients. Conclusions: Patients with small duct PSC seem to have a good prognosis in terms of survival and development of cholangiocarcinoma. Small duct PSC progresses to large duct PSC in a small proportion of patients.