We describe a 54-year-old woman with rheumatoid arthritis (RA), who developed acute respiratory failure 2 weeks after cessation of 6-week treatment with leflunomide. We diagnosed interstitial pneumonia, probably induced by leflunomide because acute respiratory failure was preceded by elevated serum liver enzyme concentration and hypertension. She showed dramatic improvement with prednisolone and cholestyramine. Prompt treatment may improve the prognosis. In Japan, leflunomide has been implicated as a possible cause to initiate or exacerbate interstitial pneumonia in patients with RA according to postmarketing surveillance. Clinicians should exclude pulmonary disease prior to initiating leflunomide treatment in patients with RA on the basis of a thorough history and physical examination, and chest radiograph.