Background The effect of leprosy on the sense of smell is not yet fully established. Studies that have relied only on patients’ perceptions may have under- or over-estimated the change in smell perception. A validated and psychophysical method is necessary to avoid these errors in assessment. Objectives This study aimed to validate the existence of olfactory involvement in leprosy patients. Methods A cross-sectional, controlled study was conducted, in which individuals with leprosy (exposed individuals) and individuals without leprosy (control patients) were recruited. For each exposed individual, we selected two control patients. A total of 108 patients (72 control patients and 36 exposed individuals) with no history of infection with the new coronavirus (COVID-19) took the University of Pennsylvania Smell Identification Test (UPSIT). Results Most exposed individuals had olfactory dysfunction [n = 33, 91.7% (CI 95%: 77.5%–98.3%)] when compared with the control patients [n = 28, 38.9% (CI 95%: 27.6%-51.1%)], but only two (5.6%) had olfactory complaints. The olfactory function was significantly worse among exposed individuals [UPSIT leprosy = 25.2 (CI 95%: 23.1–27.3) when compared with the UPSIT control patients = 34.1 (CI 95%: 33.0–35.3); p<0.001]. The risk of olfactory loss was higher among the exposed individuals [OR: 19.5 (CI 95%: 5.18–105.70; p < 0.001)]. Conclusions Olfactory dysfunction was highly prevalent among exposed individuals, although they had little or no self-knowledge of the disorder. The results show that it is important to assess the sense of smell in exposed individuals.