Background: White matter lesions (WMLs) on brain magnetic resonance imaging (MRI) in multiple sclerosis (MS) may contribute to misdiagnosis. In chronic active lesions, peripheral iron-laden macrophages appear as paramagnetic rim lesions (PRLs). Objective: To evaluate the sensitivity and specificity of PRLs in differentiating MS from mimics using clinical 3T MRI scanners. Method: This retrospective international study reviewed MRI scans of patients with MS ( n = 254), MS mimics ( n = 91) and older healthy controls ( n = 217). WMLs, detected using fluid-attenuated inversion recovery MRI, were analysed with phase-sensitive imaging. Sensitivity and specificity were assessed for PRLs. Results: At least one PRL was found in 22.9% of MS and 26.1% of clinically isolated syndrome (CIS) patients. Only one PRL was found elsewhere. The identification of ⩾1 PRL was the optimal cut-off and had high specificity (99.7%, confidence interval (CI) = 98.20%–99.99%) when distinguishing MS and CIS from mimics and healthy controls, but lower sensitivity (24.0%, CI = 18.9%–36.6%). All patients with a PRL showing a central vein sign (CVS) in the same lesion ( n = 54) had MS or CIS, giving a specificity of 100% (CI = 98.8%–100.0%) but equally low sensitivity (21.3%, CI = 16.4%–26.81%) Conclusion: PRLs may reduce diagnostic uncertainty in MS by being a highly specific imaging diagnostic biomarker, especially when used in conjunction with the CVS.