A prospective and retrospective study was undertaken to compare the accuracy of magnetic resonance imaging (MRI) with clinical examination in diagnosing meniscal and anterior cruciate ligament (ACL) tears. Pathological findings were then confirmed during arthroscopy. One hundred fifty-four patients clinically diagnosed with a meniscal or ACL tear who ultimately had arthroscopic knee surgery were evaluated; 100 patients underwent clinical examination followed by MRI, and 54 underwent clinical examination alone. The presence or absence of meniscal and ACL tears was confirmed during arthroscopy. The accuracies of clinical examination and MRI were compared for the 100 patients who underwent both clinical examination and MRI. The accuracy of MRI was 75% for medial meniscal tears, 69% for lateral meniscal tears and 98% for ACL tears. The accuracy of clinical examination was 82% for medial meniscal tears, 76% for lateral meniscal tears and 99% for complete tears of the ACL. Furthermore, the accuracy of clinical examination for the 54 patients who underwent clinical examination alone was not significantly different from the accuracy of clinical examination in the 100 patients who also underwent MRI. There was no significant difference between the accuracy of clinical examination and MRI in the diagnosis of meniscal and ACL tears and, overall, MRI contributed to treatment in only 16 of 100 cases. Based on these findings, we feel that MRI, except in certain circumstances, is an expensive and unnecessary diagnostic test in patients with suspected meniscal and ACL pathology.