Legislation passed in 2000 allowed syringe exchange programs (SEPs) in California to operate legally if local jurisdictions declare a local HIV public health emergency. Nonetheless, even in locales where SEPs are legal, the possession of drug paraphernalia, including syringes, remained illegal. The objective of this paper is to examine the association between the legal status of SEPs and individual arrest or citation for drug paraphernalia among injection drug users (IDUs) in California from 2001 to 2003. Using data from three annual cross-sections (2001-03) of IDUs attending 24 SEPs in 16 California counties (N = 1,578), we found that overall, 14% of IDUs in our sample reported arrest or citation for paraphernalia in the 6 months before the interview. Further analysis found that 17% of IDUs attending a legal SEP (defined at the county level) reported arrest or citation for drug paraphernalia compared to 10% of IDUs attending an illegal SEP (p = 0.001). In multivariate analysis, the adjusted odds ratio of arrest or citation for drug paraphernalia was 1.6 [95% confidence interval (CI) = 1.2, 2.3] for IDUs attending legal SEPs compared to IDUs attending illegal SEPs, after controlling for race/ethnicity, age, homelessness, illegal income, injection of amphetamines, years of injection drug use, frequency of SEP use, and number of needles received at last visit. IDUs attending SEPs with legal status may be more visible to police, and hence, more subject to arrest or citation for paraphernalia. These findings suggest that legislative efforts to decriminalize the operation of SEPs without concurrent decriminalization of syringe possession may result in higher odds of arrest among SEP clients, with potentially deleterious implications for the health and well-being of IDUs. More comprehensive approaches to removing barriers to accessing sterile syringes are needed if our public health goals for reducing new HIV/HCV infections are to be obtained.