Allograft histology 1 year posttransplant is an independent correlate to long-term death-censored graft survival. We assessed prognostic implications of changes in histology first 2 years posttransplant in 938 first kidney recipients, transplanted 1999-2010, followed for 93.4 AE 37.7 months. Compared to implantation biopsies, histology changed posttransplant showing at 1 year that 72.6% of grafts had minor abnormalities (favorable histology), 20.2% unfavorable histology, and 7.2% glomerulonephritis. Compared to favorable, graft survival was reduced in recipients with unfavorable histology (hazards ratio .00], p < 0.0001) or glomerulonephritis .0], p < 0.0001). Compared to unfavorable, in grafts with favorable histology, failure was most commonly due to death (42% vs. 70%, p < 0.0001) and less commonly due to alloimmune causes (27% vs. 10%, p < 0.0001). In 80% of cases, favorable histology persisted at 2 years. However, de novo 2-year unfavorable histology (15.3%) or glomerulonephritis (4.7%) related to reduced survival. The proportion of favorable grafts increased during this period (odds ratio ¼ 0.920 [0.871-0.972], p ¼ 0.003, per year) related to fewer DGF, rejections, polyoma-associated nephropathy (PVAN), and better function. Graft survival also improved ], p ¼ 0.015) related to better histology and function. Evolution of graft histologic early posttransplant relate to long-term survival. Avoiding risk factors associated with unfavorable histology relates to improved histology and graft survival.