Background: The present study aimed to evaluate the functional outcome of single-stage total knee arthroplasty using long-stem tibial component with proximal fibular resection (PFR) for patients with knee osteoarthritis with varus deformity associated with tibial stress fracture. Method: A cohort of 62 patients with a mean age 71.63 ± 7.40 years who met the criteria were randomized to a study group and a control group. Patients in the study group underwent single-stage total knee arthroplasty using long-stem tibial component with PFR. The control group received conventional treatment. All patients were followed at 1, 3, 6 and 12 month(s) after surgery. Standard anteroposterior and lateral weight bearing knee X-rays were analyzed. Western Ontario and Mc-master Universities Osteoarthritis Index score (WOMAC) and the visual analog scale (VAS) score were used to assess the functional outcome. The level of significance was set at p < 0.05 levels. Results: One patient in the study group was lost to follow-up, leaving 61 patients for final assessment. The WOMAC total score and mean VAS score were significantly better in study group than in control group at final follow-up (p < 0.05). All fractures were successfully united in a mean time of 12.26 ± 1.20 weeks in study group. A total of 16 patients in control group had delayed union, five had established nonunion and required further interventions. No complications relating to surgery was detected. Conclusion: Total knee arthroplasty with PFR for knee arthritis with varus deformity associated with tibial stress fractures restores limb alignment, improves biomechanics, enhances fracture healing and provides excellent functional outcome.