Survival is linked to the histopathologic distinction between usual interstitial pneumonia (UIP) and nonspecific interstitial pneumonia (NSIP), the most commonly encountered fibrotic idiopathic interstitial pneumonia. We retrospectively compared the prognostic significance of histopathologic diagnoses, baseline pulmonary function indices, and serial trends in pulmonary function indices (diffusing capacity, FVC, FEV₁, the recently defined composite physiologic index) at 6 and 12 months in 104 patients (UIP, n = 63; fibrotic NSIP, n = 41). Survival was lower in UIP than in fibrotic NSIP (p = 0.001) but not in patients with severe functional impairment; mortality during the first 2 years was linked solely to the severity of functional impairment at presentation. The composite physiologic index was the strongest determinant of outcome (p < 0.001). At 6 months, serial diffusing capacity levels (p = 0.003) and histopathologic diagnosis (p = 0.002) were prognostically equivalent. At 12 months, serial pulmonary function trends were the only major prognostic determinant (p < 0.0005 for all variables), with no independent significance associated with the distinction between UIP and fibrotic NSIP. We conclude that at 12 months, serial pulmonary function trends have considerable prognostic value in UIP and NSIP. Their histologic distinction provides no additional prognostic information when pulmonary function trends are clear cut or when functional impairment is severe.