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ImportanceLimited effective therapeutics are available to hospitalized patients with COVID-19. Clinical trials and observational studies have shown varying effects of systemic corticosteroids, including dexamethasone, in hospitalized patients with COVID-19, with limited descriptions of important patient subgroups.ObjectiveTo examine the clinical use of dexamethasone for hospitalized patients with COVID-19 respiratory illness and to explore the heterogeneity of treatment outcomes across different subgroups.Design, Setting, and ParticipantsThis is a retrospective, propensity score–weighted cohort study of adult patients hospitalized for at least 48 hours for COVID-19 respiratory illness between July 1, 2020, and October 31, 2021, at a large health care network of 156 hospitals across the US. Data analysis was performed from March 2022 to February 2023.ExposuresSystemic dexamethasone administered within 48 hours of either admission or escalation in oxygen support.Main Outcomes and MeasuresAll-cause in-hospital mortality or discharge to hospice.ResultsA total of 80 699 patients who met the eligibility criteria were identified (median [IQR] age, 64 [52-76] years; 37 606 women [46.6%]); 13 230 patients (16.4%) identified as Black, 49 222 (60.9%) as White, 18 247 (22.6%) as other race, and 20 340 (25.2%) as Hispanic ethnicity. Of these patients, 13 040 (16.2%) did not require supplemental oxygen within 48 hours of admission, 56 368 (69.8%) required supplemental oxygen, 7618 (9.4%) required noninvasive positive pressure ventilation (NIPPV), and 3673 (4.6%) required mechanical ventilation (MV) and/or extracorporeal membrane oxygenation (ECMO). After adjustment by propensity score overlap weighting, early use of dexamethasone was associated with reduction in a composite outcome of in-hospital mortality or discharge to hospice for patients receiving supplemental oxygen (aOR, 0.92; 95% CI, 0.86-0.98) and MV and/or ECMO (aOR, 0.82; 95% CI, 0.68-0.99). In contrast, all-cause inpatient mortality or discharge to hospice was not lower for patients who received dexamethasone in the no supplemental oxygen group (aOR, 0.90; 95% CI, 0.78-1.03) and in the NIPPV group (aOR, 0.87; 95% CI, 0.73-1.04). Importantly, patients with more comorbidities had greater benefit from dexamethasone use.Conclusions and RelevanceIn this national multicenter cohort study of inpatients with COVID-19, early administration of dexamethasone was associated with significantly reduced odds of mortality or discharge to hospice in those requiring supplemental oxygen or MV and/or ECMO but not in those requiring no supplemental oxygen or NIPPV. These results support the continued use of systemic dexamethasone in patients hospitalized with COVID-19.