BACKGROUND: Previous studies reporting the impact of osteoarthritis (OA) on pain and function after hip arthroscopy largely predate resection of femoroacetabular impingement (FAI). QUESTIONS/PURPOSES: We determined (1) functional improvement after resection of FAI impingement lesions in patients with preoperative radiographic joint space narrowing, and (2) identified preoperative predictors of pain, function, and failure rates in these patients. PATIENTS AND METHODS: Between September 2004 and April 2008, we treated 210 patients (227 hips) with FAI and a minimum 12-month followup (mean, 27 months). Group FAI consisted of 154 patients (169 hips) without radiographic joint space narrowing, whereas Group FAI-OA consisted of 56 patients (58 hips) with preoperative radiographic joint space narrowing. We collected Harris hip scores (HHS), Short Form-12 (SF-12), and pain scores on a visual analog scale (VAS) preoperatively and postoperatively. RESULTS: Score improvements were better for Group FAI compared with Group FAI-OA. The overall failure rate was greater for Group FAI-OA (52%) than for Group FAI (12%). Although patients with less than 50% joint space narrowing or greater than 2 mm joint space remaining on preoperative radiographs had improved scores throughout the study, we observed no score improvements at any time with advanced preoperative joint space narrowing. Greater joint space narrowing, advanced MRI chondral grade, and longer duration of preoperative symptoms predicted lower scores. CONCLUSION: FAI correction with milder degrees of preoperative radiographic joint space narrowing resulted in improvements in pain and function at short-term followup. Patients with advanced radiographic joint space narrowing do not improve and we believe should not be considered for arthroscopic FAI correction.