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Background The long-term consequences of unsuccessful interferon-α based hepatitis C treatment on liver disease progression and survival have not been fully explored. Methods and Findings We performed retrospective analyses to assess long-term clinical outcomes among treated and untreated patients with hepatitis C virus in two independent cohorts from a United States Veterans Affairs Medical Center and a University Teaching Hospital. Eligible patients underwent liver biopsy during consideration for interferon-α based treatment between 1992 and 2007. They were assessed for the probability of developing cirrhosis and of dying during follow-up using Cox proportional hazards models, stratified by pretreatment liver fibrosis stage and adjusted for known risk factors for cirrhosis and characteristics affecting treatment selection. The major predictor was a time-dependent covariate for treatment outcome among four patient groups: 1) patients with sustained virological response to treatment; 2) treatment relapsers; 3) treatment nonresponders; and 4) never treated patients. Treatment nonresponders in both cohorts had a statistically significantly increased hazard of cirrhosis compared to never treated patients, as stratified by pretreatment liver fibrosis stage and adjusted for clinical and psychosocial risk factors that disproportionately affect patients who were ineligible for treatment (Veterans Affairs HR = 2.35, CI 1.18–4.69, mean follow-up 10 years, and University Hospital HR = 5.90, CI 1.50–23.24, mean follow-up 7.7 years). Despite their increased risk for liver disease progression, the overall survival of nonresponders in both cohorts was not significantly different from that of never treated patients. Conclusion These unexpected findings suggest that patients who receive interferon-α based therapies but fail to clear the hepatitis C virus may have an increased hazard of cirrhosis compared to untreated patients.