Reduction of serum urate and phosphate levels has been observed in patients receiving leflunomide therapy, but the mechanism for such changes has not been evaluated. Thirty-eight patients with rheumatoid arthritis who began leflunomide were studied. Serum urate, creatinine, and phosphate, and 24-hour uric acid, creatinine, and phosphate were measured before, during, and in some instances after leflunomide treatment. Clearances of urate and creatinine, fractional excretion of urate, and tubular reabsorption of phosphate were calculated. Undissociated urinary uric acid was estimated with a nomogram. Twelve patients gave consent to withdraw leflunomide treatment of a 2-week period and underwent a third study. Decreases in serum urate and phosphate levels were observed, with parallel increases in clearances of urate and in fractional excretion of urate, and a reduction in tubular reabsorption of phosphate. Clearances of creatinine and undissociated urinary uric acid remained unchanged. Two weeks after withdrawing the drug, a partial return toward baseline values was observed, but residual changes were apparent. No case of clinical gout was observed. Leflunomide enhances urate and phosphate loss, an effect that partially persisted after 2-week withdrawal. The long-term effect of mild phosphate wasting warrants further investigation. The urate-lowering effect of leflunomide may be useful in monitoring compliance in leflunomide therapy.