Several drug trials, predominantly of Caucasian patients, have demonstrated the therapeutic role of leflunomide (LEF) in the treatment of rheumatoid arthritis (RA). We report an Indian (Asian) experience from a prospective observational study. Two hundred thirty affording patients with moderately severe active RA (naïve for LEF), mostly failing methotrexate (MTX), were begun LEF (Aravatrade mark; 20 mg daily, post loading 100 mg od x 3 days) in a clinic setting and followed regularly in an open cohort as per standard of care practice guidelines. A priori, LEF was to be preferably used as a single-agent disease-modifying anti-rheumatic drug (DMARD). One hundred forty-three patients and 87 patients were clinically assigned to the LEF monotherapy and LEF + MTX combination, respectively; less than one third received prednisolone. We focus on 146 patients (64%) completing 1 year treatment. Patients improved significantly (p < 0.05, analysis of variance) in several measures (including Health Assessment Questionnaire). Though unintended (non-randomized), the treatment subgroups matched at baseline. Of patients, 42% and 24% in LEF monotherapy and LEF + MTX, respectively showed American College of Rheumatology 50% Response Criteria (ACR 50) improvement. LEF monotherapy showed a better 'time to first ACR 20 improvement' outcome over 1 year (survival function curve, Cox Hazard Ratio = 0.71, 95% confidence interval 0.52, 0.96). Ten percent to 30% patients reported diarrhea, hair loss, skin rash, and dyspepsia; <3% reported abnormal liver functions. Eighty-four patients (36.5%) withdrew (8.7% adverse events and 18.7% non-affordability). LEF is an effective and safe DMARD in our ethnic patient population and may suffice as a single agent (to treat moderately severe RA) during the initial 1 year.