The incidence of avascular bone necrosis post-transplantation has fallen as a result of new advances in immunosuppression and lower corticosteroid therapy. It is commonly occurring in association wih prolonged high dose steroids. Occuring 6 months after transplantation is less likely to result from steroid treatment. Single report had advocated that sirolimus treatment is associated with higher incidence of avascular bone necrosis than historical controls being 3.8% and 0.5% respectively. This study was carried out between May 2001 through June 2002 and included 80 live donor renal allotransplant recipients. The patients were stratified into 2 equal demographically matched groups to receive either sirolimus (5mg) +steroids+low dose tacrolimus (Group A) or sirolimus (10mg)+steroids+mycophenolate mofetil (Group B). Both groups received basiliximab induction therapy. One year follow up of all patients was carried out (range 12-24, mean 18.13±5.19 months). Routine assessment of serum calcium, phosphorus and alkaline phosphatase was performed for all patients at regular time points. Magnetic resonance imaging was conducted for all patients with symptomatic hip arthralgia. High incidence of avascular bone necrosis was noticed in both groups being three patients as (7.5%) and five patients (12.5%) in group A and B respectively. All affected patients underwent hip decompression and some of them had total hip replacement. Sirolimus may be a cause of early post-transplant avascular necrosis which may be attributed to sirolimus adverse lipid profile, its potent immunosuppressive effect or perhaps an idiosyncratic effect.