Background: Glucocorticoid immunosuppressant therapy in pediatric kidney transplant (Tx) recipients does not allow the improvement of growth after Tx. Objective: To determine the effect of early steroid withdrawal (SW) on longitudinal growth, insulin sensitivity (IS), and body composition (BC). Methods: This was a prospective, randomized, multicenter study in Tx. Insulin-like growth factor (IGF)-I, IGF-binding protein 3 (IGFBP3), IS, and BC (DEXA/pQCT) were determined at baseline and up to 12 months after Tx. Results: A total of 30 patients were examined; 14 patients were assigned to the SW group (7 male, 7 female; 12 in Tanner stage I) and 16 patients were assigned to the steroid control (SC) group (10 male, 6 female;12 in Tanner stage I). Their chronological age was 7.8 ± 4.3 years, height was -2.3 ± 0.99 SD scores (SDS), and body mass index -0.3 ± 1.2 SDS. After 1 year, the SW group showed an increase in height SDS (+1.2 ± 0.22 vs. +0.60 ± 0.13 SDS in the SC group, p < 0.02), lower IGFBP3 (p < 0.05), cholesterol (p < 0.05), and higher high-density lipoprotein cholesterol (p < 0.05). SW patients had lower trunk fat with no differences in IS. Only in prepubertal patients, the SW group had lower glycemia (p < 0.05), very low-density lipoprotein cholesterol (p < 0.01), triglycerides (p < 0.05), triglycerides/glycemia index (TyG; p < 0.02), and better lean mass. Both groups showed an improvement in lean mass after kidney Tx. Conclusions: SW improved longitudinal growth, lipid profile, and trunk and lean fat in Tx patients. In prepubertal recipients, the decrease in TyG suggests better IS.