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The objective of this study was to analyze different types of nodal basin recurrence after sentinel lymph node biopsy (SLNB) for melanoma. Patients and Methods: Kaplan–Meier estimates and the Cox proportional hazards model were used to study 2653 patients from 3 German melanoma centers retrospectively. The estimated 5-year negative predictive value of SLNB was 96.4%. The estimated false-negative (FN) rates after 1, 2, 3, 5, and 10 years were 2.5%, 4.6%, 6.4%, 8.7%, and 12.6%, respectively. Independent factors associated with false negativity were older age, fewer SLNs excised, and head or neck location of the primary tumor. Compared with SLN-positive patients, the FNs had a significantly lower survival. In SLN-positive patients undergoing completion lymphadenectomy (CLND), the 5-year nodal basin recurrence rate was 18.3%. The recurrence rates for axilla, groin, and neck were 17.2%, 15.5%, and 44.1%, respectively. Significant factors predicting local relapse after CLND were older age, head, or neck location of the primary tumor, ulceration, deeper penetration of the metastasis into the SLN, tumor-positive CLND, and >2 lymph node metastases. All kinds of nodal relapse were associated with a higher prevalence of in-transit metastases. The FN rate after SLNB steadily increases over the observation period and should, therefore, be estimated by the Kaplan–Meier method. False-negativity is associated with fewer SLNs excised. The beneficial effect of CLND on nodal basin disease control varies considerably across different risk groups. This should be kept in mind about SLN-positive patients when individual decisions on prophylactic CLND are taken.