Although partial nephrectomy is the preferred treatment for many patients with early-stage kidney cancer, recent clinical trial data, which demonstrate better survival for patients treated with radical nephrectomy, have generated new uncertainty regarding the comparative effectiveness of these treatment options. To compare long-term survival after partial vs. radical nephrectomy among a population-based patient cohort whose treatment reflects contemporary surgical practice. We performed a retrospective cohort study of Medicare beneficiaries with clinical stage T1a kidney cancer treated with partial or radical nephrectomy from 1992 to 2007. Using an instrumental variable approach to account for measured and unmeasured differences between treatment groups, we fit a 2-stage residual inclusion model to estimate the treatment effect of partial nephrectomy on long-term survival. Overall survival and kidney cancer-specific survival. Among 7,138 Medicare beneficiaries with early-stage kidney cancer, we identified 1,925 patients (27.0%) treated with partial nephrectomy and 5,213 patients (73.0%) treated with radical nephrectomy. During a median follow-up of 62 months, 487 (25.3%) and 2,164 (41.5%) patients died following partial or radical nephrectomy, respectively. Kidney cancer was the cause of death for 37 patients (1.9%) treated with partial nephrectomy, and 222 patients (4.3%) treated with radical nephrectomy. Patients treated with partial nephrectomy had a significantly lower risk of death (hazard ratio 0.54; 95% CI, 0.34-0.85). This corresponded with a predicted survival increase with partial nephrectomy of 5.6 (95% CI, 1.9-9.3), 11.8 (95% CI, 3.9-19.7), and 15.5 (95% CI, 5.0-26.0) percentage points at 2, 5, and 8 years post treatment (P <0.001). No difference was noted in kidney cancer-specific survival (hazard ratio 0.82; 95% CI, 0.19-3.49). Among Medicare beneficiaries with early-stage kidney cancer who were candidates for either surgery, treatment with partial rather than radical nephrectomy was associated with improved survival.