Since the introduction of highly active antiretroviral therapy (HAART), little is known about whether changes in HIV-1 mortality and morbidity rates have been sustained. We aimed to assess possible changes in these rates across Europe. We analysed data for 9803 patients in 70 European HIV centres including ones in Israel and Argentina. Incidence rates of AIDS or death were calculated for overall and most recent CD4 count in 6-monthly periods and in three treatment eras (pre-HAART, 1994-1995; early-HAART, 1996-1997; and late-HAART, 1998-2002). The incidence of AIDS or death fell after September, 1998, by 8% per 6-month period (rate ratio 0.92, 95% CI 0.88-0.95, p<0.0001). When AIDS and death were analysed separately, the incidence of all deaths during the late-HAART era was significantly lower than that during the early-HAART era in patients whose latest CD4 count was 20 cells/microL or less (0.43, 0.35-0.53, p<0.0001), but at higher CD4 counts, did not differ between early-HAART and late-HAART. Incidence of AIDS was about 50% lower in late-HAART than in early-HAART, irrespective of latest CD4 count (p<0.0001). In multivariate Cox's models, with early-HAART as the reference, there was an increased risk of AIDS (relative hazard 1.39; 95% CI 1.16-1.67, p=0.0004) and all deaths (1.29; 1.08-1.56, p=0.0065) in the pre-HAART era, and a reduced risk of AIDS (0.62; 0.50-0.77, p<0.0001) and all deaths (0.66; 0.53-0.82, p=0.0002) in the late-HAART era. The initial drop in mortality and morbidity after the introduction of HAART has been sustained. Potential long-term adverse effects associated with HAART have not altered its effectiveness in treating AIDS.