Relationships between high-resolution computed tomography (HRCT) findings in chronic obstructive pulmonary disease (COPD) and bacterial colonization, airway inflammation, or exacerbation indices are unknown. Fifty-four patients with COPD (mean [SD]: age, 69  years; FEV(1), 0.96 [0.33] L; FEV(1) [percent predicted], 38.1 [13.9]%; FEV(1)/forced vital capacity [percent predicted], 40.9 [11.8]%; arterial partial pressure of oxygen, 8.77 [1.11] kPa; history of smoking, 50.5 [33.5] smoking pack-years) underwent HRCT scans of the chest to quantify the presence and extent of bronchiectasis or emphysema. Exacerbation indices were determined from diary cards over 2 years. Quantitative sputum bacteriology and cytokine measurements were performed. Twenty-seven of 54 patients (50%) had bronchiectasis on HRCT, most frequently in the lower lobes (18 of 54, 33.3%). Patients with bronchiectasis had higher levels of airway inflammatory cytokines (p = 0.001). Lower lobe bronchiectasis was associated with lower airway bacterial colonization (p = 0.004), higher sputum interleukin-8 levels (p = 0.001), and longer symptom recovery time at exacerbation (p = 0.001). No relationship was seen between exacerbation frequency and HRCT changes. Evidence of moderate lower lobe bronchiectasis on HRCT is common in COPD and is associated with more severe COPD exacerbations, lower airway bacterial colonization, and increased sputum inflammatory markers.