In order to determine the predictive value of lung function studies for subsequent prognosis in systemic sclerosis, 71 patients with systemic sclerosis were followed up for a mean of five years after pulmonary function testing. A carbon monoxide diffusing capacity less than or equal to 40 percent of the predicted reference value was associated with only a 9 percent five-year cumulative survival rate compared with a 75 percent cumulative five-year survival in patients with a carbon monoxide diffusing capacity greater than 40 percent of predicted. An obstructive ventilatory defect was also associated with increased mortality, and all six patients with obstruction and a diffusing capacity less than 70 percent of the predicted died during the study period. Male gender, independent of abnormalities of pulmonary function, was also associated with a poor prognosis. Although it is not clear whether a severely impaired diffusing capacity is indicative of interstitial pulmonary fibrosis or pulmonary vasculopathy or is a marker of generalized vascular disease, a severely depressed carbon monoxide diffusing capacity is an important predictor of mortality in patients with systemic sclerosis.