To evaluate whether perineural invasion (PNI) is an important prognostic factor in patients with rectal cancer, we reviewed the records of 373 patients who underwent curative surgery. Thirty-seven patients (9.9%) were identified as having tumors with PNI. The incidence of PNI was significantly increased in lesions categorized as stage III by the International Union Against Cancer (UICC) system (20%). There was a significant difference in local recurrence between patients with stage III lesions with PNI and those with stage III lesions without PNI (p < 0.005). Also, patients with PNI of stage III lesions had a significantly lower 8-year survival rate (26.7%, p < 0.001). We conclude that PNI is an important factor influencing the prognosis of patients with stage III disease. PNI should be classified as a subgroup of the clinical stage.