Background Radiofrequency ablation of the genicular nerve is performed for knee osteoarthritis (KOA) when conservative treatment is not effective. Chemical ablation may be an alternative, but its effectiveness and safety have not been examined. The objective of this prospective open‐label cohort study is to evaluate the effectiveness and safety of ultrasound‐guided chemical neurolysis for genicular nerves with phenol to treat patients with chronic pain from KOA. Methods Forty‐three patients with KOA with pain intensity score (Numeric Rating Scale, NRS) ≥ 4, and duration of pain of more than 6 months were considered for enrollment. Ultrasound‐guided diagnostic blocks of genicular nerves (superomedial, inferomedial, and superolateral) with 1.5 mL of 0.25% bupivacaine at each site were performed. Those who reported more than 50% reduction in NRS went on to undergo chemical neurolysis, using 1.5 mL 7% glycerated phenol in each genicular nerve. NRS and Western Ontario and McMaster Universities Arthritis Index (WOMAC) scores were assessed before intervention and at 2 weeks and 1, 2, 3, and 6 months following the intervention. Results NRS and WOMAC scores improved at all time points. Mean pain intensity improved from 7.2 (95% confidence interval [CI]: 6.8 to 7.7) at baseline to 4.2 (95%CI: 3.5 to 5.0) at 6‐month follow‐up (P < 0.001). Composite WOMAC score improved from 48.7 (95%CI: 43.3 to 54.2) at baseline to 20.7 (95%CI: 16.6 to 24.7) at 6‐month follow‐up (P < 0.001). Adverse events did not persist beyond 1 month and included local pain, hypoesthesia, swelling, and bruise. Conclusion Chemical neurolysis of genicular nerves with phenol provided efficacious analgesia and functional improvement for at least 6 months in most patients with a low incidence of adverse effects.