Ursodeoxycholic acid (UDCA) is a safe and effective medical therapy for most patients with primary biliary cirrhosis (PBC). However, some patients show an incomplete response to UDCA therapy. Treatment with corticosteroids may be of benefit although at the expense of systemic side effects. Budesonide, a corticosteroid with an extensive first‐pass hepatic metabolism appeared promising for the treatment of PBC. The aim of this study was to evaluate the safety and estimate the efficacy of budesonide in patients with PBC, who have shown a suboptimal response to UDCA. Twenty‐two patients with PBC, 16 women, median age of 50 who had been on UDCA (13‐15 mg/kg/d) for a mean of 46 months (range 6‐108 months) and had shown a persistent elevation of alkaline phosphatase activity at least 2 times the upper limit of normal were enrolled. Oral budesonide, 9 mg daily was administered for 1 year and patients continued on the same dosage of UDCA. There was a significant, but transitory improvement in serum levels of total bilirubin (P = .001) and a significant, but marginal improvement in serum alkaline phsophatase (P = .001) with combination therapy. The Mayo risk score increased significantly (P = .02) and there was a significant loss of bone mass (P < .001) of the lumbar spine. Budesonide‐induced hyperglycemia and cosmetic adverse effects were noted in 2 patients. In conclusion, oral budesonide appears to add minimal, if any, additional benefit to UDCA, and it is associated with a significant worsening of osteoporosis in patients with PBC.