Patients with chronic obstructive pulmonary disease (COPD) frequently develop exacerbations, leading to major clinical and health resource use ramifications. To prospectively evaluate the effectiveness of a long-acting inhaled anticholinergic bronchodilator, tiotropium, in reducing COPD exacerbations and exacerbation-related health care utilization. Randomized, double-blind study. 26 Veterans Affairs medical centers. 1829 patients with moderate to severe COPD (mean baseline FEV(1), 36% predicted). Once-daily tiotropium (18 microg) or placebo for 6 months. Patients otherwise received usual care, except for other anticholinergic bronchodilators. The coprimary end points were the percentage of patients with a COPD exacerbation and the percentage of patients with a COPD-related hospitalization. Tiotropium significantly reduced the percentage of patients experiencing 1 or more exacerbations compared with placebo (27.9% vs. 32.3%, respectively; difference, -5.7 percentage points [95% CI, -10.4 to -1.0 percentage points]; P = 0.037). Fewer tiotropium patients were hospitalized because of COPD exacerbation (7.0% vs. 9.5%, respectively; difference, -3.0 percentage points [CI, -5.9 to -0.1 percentage points]; P = 0.056), although this difference was of borderline statistical significance. Analysis of secondary outcomes indicates that tiotropium may lengthen the time to first COPD exacerbation (P = 0.028) and reduce health care utilization for exacerbations, including the frequency of hospitalizations (P = 0.047), unscheduled clinic visits (P = 0.019), and days of antibiotic treatment (P = 0.015). Tiotropium did not statistically significantly reduce all-cause hospitalization rates. Trial participants were enrolled from 1 health care system, and 99% were men. The follow-up period extended for only 6 months. Tiotropium reduces COPD exacerbations and may reduce related health care utilization in patients with moderate to severe COPD.