The long-term outcome of pulmonary function was evaluated in farmer's lung (FL) patients compared to representative control farmers. This is, to our knowledge, the first such study which has included a control group. Clinical examinations were conducted in 89 FL patients and 84 control farmers, matched by age, sex, and smoking habits. The mean time after the first diagnosed episode of FL was 14 yrs. The mean transfer factor of the lung for carbon monoxide (TL,CO) was on average 12% lower (p < 0.001) in FL patients compared to control farmers. In spirometry, the mean maximum expiratory flow at 50% of vital capacity (MEF50) was lower (p = 0.08) in FL patients but there were no differences in mean vital capacity (VC) or forced expiratory volume in one second (FEV1) between FL patients and control farmers. However, airway obstruction, defined as an FEV1/VC less than 88% of predicted, was more common in FL patients than in control farmers (33 versus 17%; p = 0.02). Patients who had had recurrent episodes of FL had a significantly lower mean TL,CO compared to those FL patients who had experienced only a single episode. In conclusion, impairment of the pulmonary transfer factor is the most important long-term consequence of farmer's lung. However, farmer's lung may also lead to development of airway obstruction.