Cyclosporin (CyA) has been shown to be highly effective and well tolerated in the short-term treatment of severe childhood atopic dermatitis; however, there is limited experience in its longer-term use. The aim of this study was to compare multiple short courses of CyA with continuous therapy for 1 year, with respect to efficacy, safety, tolerability and quality of life. Children aged 2–16 years, with a diagnosis of severe atopic dermatitis refractory to topical steroid therapy, were randomly assigned to receive short course therapy (multiple courses of 12 weeks) or continuous therapy. The starting dose and maximum dose for all patients was 5 mg/kg per day. Disease activity was monitored using the Six Area Six Sign Atopic Dermatitis score and the ‘Rule of Nines’ area score. Pruritus, sleep disturbance and irritability were measured using visual analogue scales, and topical therapy was monitored. Safety measurements included monitoring of serum creatinine, blood pressure and adverse events. Forty patients were included in the efficacy analysis, 21 of whom were randomized to the short course group (of whom six were withdrawn) and 19 to the continuous group (of whom five were withdrawn). Significant improvements were seen in all efficacy parameters at every time-point. There were no significant differences between groups, although the improvement was more consistent in the continuous arm. In the short course arm, 7 out of 21 patients could be managed by at least two short courses. The remaining 14 patients includes 12 who could not be controlled by at least two short courses, one patient who failed to return after week 12 and another patient who was withdrawn at week 4 due to an adverse event. Quality of life improved for both the children and their families. Tolerability was considered good or very good in at least 80% of the patients at week 12 and at the end of the study. No clinically significant change was seen in mean serum creatinine and no change was seen in mean blood pressure in either group. CyA is effective in controlling severe atopic dermatitis in children over a 1-year period and is well tolerated. More consistent control is achieved with continuous treatment; however, short course therapy was adequate for some patients, indicating that treatment should be tailored to the individual patient’s needs. Short course treatment may produce prolonged remission in some cases and reduce the cumulative exposure to the drug.