To determine whether steroid avoidance in pediatric kidney transplantation is safe and efficacious, a randomized, multicenter trial was performed in 12 pediatric kidney transplant centers. One hundred thirty children receiving primary kidney transplants were randomized to steroid-free (SF) or steroid-based (SB) immunosuppression, with concomitant tacrolimus, mycophenolate and standard dose daclizumab (SB group) or extended dose daclizumab (SF group). Follow-up was 3 years posttransplant. Standardized height Z-score change after 3 years follow-up was -0.99 ± 2.20 in SF versus -0.93 ± 1.11 in SB; p = 0.825. In subgroup analysis, recipients under 5 years of age showed improved linear growth with SF compared to SB treatment (change in standardized height Z-score at 3 years -0.43 ± 1.15 vs. -1.07 ± 1.14; p = 0.019). There were no differences in the rates of biopsy-proven acute rejection at 3 years after transplantation (16.7% in SF vs. 17.1% in SB; p = 0.94). Patient survival was 100% in both arms; graft survival was 95% in the SF and 90% in the SB arms (p = 0.30) at 3 years follow-up. Over the 3 year follow-up period, the SF group showed lower systolic BP (p = 0.017) and lower cholesterol levels (p = 0.034). In conclusion, complete steroid avoidance is safe and effective in unsensitized children receiving primary kidney transplants.