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Hydroxyurea is an effective treatment for psoriasis but consistently produces macrocytosis in peripheral blood with a fall in haemoglobin levels and white cell counts. In this long-term study of 16 patients anaemia and leukopenia have proved frequent and troublesome side effects requiring discontinuance of treatment in many cases. In view of these findings hydroxyurea cannot be recommended as the drug of first choice even for treating severe and intractable psoriasis, and it is our opinion that methotrexate is safer and at least as effective in these circumstances. The clearest indications for the use of hydroxyurea appear to be in life-ruining psoriasis when methotrexate treatment has either failed or is contraindicated because of liver damage. A great deal more investigative work is required before these indications can be generally extended.