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Early renal dysfunction following liver transplantation is associated with increased morbidity and mortality. To evaluate the impact of delayed initiation of calcineurin inhibitor on renal function, we conducted a retrospective study comparing 118 liver transplant recipients who received rabbit anti-thymocyte globulin and delayed initiation of calcineurin inhibitor with 80 liver transplant recipients who received no antibody and early initiation of calcineurin inhibitor (control group). All patients received mycophenolate mofetil and steroids. Delayed calcineurin inhibitor initiation with anti-thymocyte globulin was associated with significant improvement in renal function throughout the first year post-transplant. At 12 months post-transplant, patients treated with this regimen experienced lower serum creatinine (1.4 ± 0.5 versus 1.7 ± 0.5 mg/dL, P < 0.001), a higher estimated glomerular filtration rate (57.4 ± 20.5 versus 43.7 ± 14.4 mL/min/1.73 m2, P < 0.001), and less dependence on dialysis (0.8% versus 13%, P < 0.001) in comparison with no antibody and early calcineurin inhibitor initiation. Patient survival and graft survival were similar between groups; however, there was a trend of a lower incidence of early biopsy-proven acute rejection with anti-thymocyte globulin. Overall infection and cytomegalovirus infection were significantly lower in anti-thymocyte globulin–treated patients, and there was no increased incidence of hepatitis C recurrence in comparison with controls. In conclusion, delayed initiation of calcineurin inhibitor with anti-thymocyte globulin in liver transplant recipients is safe and is associated with improvements in renal function and a lower incidence of early acute rejection in comparison with no antibody and early initiation of calcineurin inhibitor. Liver Transpl 14:66–72, 2008. © 2007 AASLD.