Background: Effective treatments for onychomycosis are expensive. Previous studies suggest that less costly, pulsed doses of antifungal medications may be as effective as standard, continuous doses. Terbinafine is the current treatment of choice for toenail onychomycosis. Objective: Our purpose was to determine whether pulse-dose terbinafine is as effective as standard continuous-dose terbinafine for treatment of toenail onychomycosis. Methods: We conducted a double-blind, randomized, noninferiority, clinical intervention trial in the Minneapolis Veterans Affairs Medical Center. The main inclusion criteria for participants were a positive dermatophyte culture and at least 25% distal subungual clinical involvement. Six hundred eighteen volunteers were screened; 306 were randomized. Terbinafine, 250 mg daily for 3 months (continuous) or terbinafine, 500 mg daily for 1 week per month for 3 months (pulse) was administered. The primary outcome measure was mycological cure of the target toenail at 18 months. Secondary outcome measures included clinical cure and complete (clinical plus mycological) cure of the target toenail and complete cure of all 10 toenails. Results: Results of an intent-to-treat analysis did not meet the prespecified criterion for noninferiority but did demonstrate the superiority of continuous-dose terbinafine for: mycological cure of the target toenail (70.9% [105/148] vs 58.7% [84/143]; P =.03, relative risk [RR] of 1.21 [95% confidence interval (CI), 1.02-1.43]); clinical cure of the target toenail (44.6% [66/148] vs 29.3% [42/143]; P =.007, RR = 1.52 [95% CI, 1.11-2.07); complete cure of the target toenail (40.5% [60/148] vs 28.0% [40/143]; P =.02, RR = 1.45 [95% CI, 1.04-2.01); and complete cure of all 10 toenails (25.2% [36/143] vs 14.7% [21/143]; P =.03, RR = 1.71 [95% CI, 1.05-2.79). Tolerability of the regimens did not differ significantly between the groups (χ 2 = 1.63; P =.65). Limitations: The study population primarily consisted of older men with severe onychomycosis. Conclusions: This study demonstrated the superiority of continuous- over pulse-dose terbinafine. We also found this expensive therapy to be much less effective than previously believed, particularly for achieving complete cure of all 10 toenails.