The location and extent of an abnormal signal on MRI of the optic nerve affected by optic neuritis are said to correlate with the severity of initial visual loss and recovery. We used gadolinium-enhanced fat-suppressed MRI to show abnormal enhancement of the optic nerve to determine the sensitivity of this modality in acute optic neuritis and whether the abnormal enhancement correlates with presenting visual deficits or recovery. A total of 107 patients, 93 with follow-up (68 steroid treated), were included; 101 patients had enhancement of the affected optic nerve and no unaffected nerve enhanced. The baseline visual performance was similar between nerves with and without enhancement. Optic nerves with enhancement in the optic canal had poorer colour vision (P = 0.04) and nerves with all segments involved had worse threshold perimetry (P = 0.001) and colour vision (P = 0.008). Nerves with enhancement >10 mm had worse threshold perimetry (P = 0.004), while nerves with enhancing segments >17 mm had poorer baseline visual acuity (P = 0.02), threshold perimetry (P = 0.009) and colour vision (P = 0.01). For all parameters of vision, recovery was similar regardless of location or length of abnormal enhancement. Abnormal contrast enhancement of the optic nerve is a sensitive (94%) finding in acute optic neuritis and is absent in unaffected or previously affected optic nerves. Although lesions involving the canal or longer segments of optic nerve have worse starting vision, the location and length of enhancement are not predictive of recovery.