Background Although inhaled glucocorticosteroids are recommended for persistent asthma, their long-term effect on recent onset, mild, persistent asthma has yet to be established. Methods We did a randomised, double-blind clinical trial in 7241 patients in 32 countries to assess the effects of budesonide in patients who had had mild persistent asthma for less than 2 years and who had not had previous regular treatment with glucocorticosteroids. Patients aged 5-66 years received either budesonide or placebo once daily for 3 years in addition to their usual asthma medications. The daily budesonide dose was 400 μg, or 200 μg for children younger than 11 years. The primary outcome was time to first severe asthma-related event, and analysis was by intention to treat. Findings 198 of 3568 patients on placebo and 117 of 3597 on budesonide had at least one severe asthma exacerbation; hazard ratio 0.56 (95% CI 0.45-0.71, p<0.0001). Patients on budesonide had fewer courses of systemic corticosteroids and more symptom-free days than did those on placebo. Compared with placebo, budesonide increased postbronchodilator forced expiratory volume in 1 s (FEV1) from baseline by 1.48% (p<0.0001) after 1 year and by 0.88% (p=0.0005) after 3 years (expressed as percent of the predicted value). The corresponding increase in prebronchodilator FEV1 was 2.24% after 1 year and 1.71% after 3 years (p<0.0001 at both timepoints). The effect of treatment on all outcome variables was independent of the baseline lung function (prebronchodilator or postbronchodilator) or baseline medication. In children younger than 11 years, 3-year growth was reduced in the budesonide group by 1.34 cm. The reduction was greatest in the first year of treatment (0.58 cm) than years 2 and 3 (0.43 cm and 0.33 cm, respectively) Interpretation Long-term, once-daily treatment with low-dose budesonide decreases the risk of severe exacerbations and improves asthma control in patients with mild persistent asthma of recent onset.