Background Patients with diffuse panbronchiolitis (DPB) are routinely treated with erythromycin, clarithromycin, and roxithromycin. The clinical effect of azithromycin on DPB has not been confirmed in a large cohort. Objective The present study was undertaken to investigate the clinical effects of azithromycin on patients with DPB. Methods Fifty-one patients with DPB treated with azithromycin in Shanghai Pulmonary Hospital, China, from July 2001 to April 2007 were analyzed retrospectively. Azithromycin (500 mg a day) was administrated intravenously in the first 1-2 weeks, taken orally (500 mg, once a day) for 3 months, and tapered to 3 times a week for 6-12 months. The patients were followed up until September 1, 2009. The therapeutic effect, according to their clinical and radiological findings, arterial gas analysis, lung function, and sputum bacterium before and after the therapy, was categorized into the following five grades: 1) cured; 2) improved; 3) no response; 4) aggravation, and 5) relapse. Results With azithromycin therapy, 14 (27.5%) patients with DPB were completely cured. The symptoms were eliminated to certain degrees for the other 36 cases (70.6%) of DPB. Five-year survival in this cohort was 94.1%. Conclusion Azithromycin is effective and well tolerated for patients with diffuse panbronchiolitis.