Background: Arthroscopic stabilization has been established as a superior treatment option for primary glenohumeral instability when compared with immobilization in internal rotation. However, immobilization in external rotation (ER) has recently gained interest as a viable nonoperative treatment option for patients with shoulder instability. Purpose: To compare the rates of recurrent instability and subsequent surgery in patients undergoing treatment for primary anterior shoulder dislocation with arthroscopic stabilization versus immobilization in ER. Study Design: Systematic review; Level of evidence, 2. Methods: A systematic review was performed by searching PubMed, the Cochrane Library, and Embase to identify studies that’evaluated patients being treated for primary anterior glenohumeral dislocation with either arthroscopic stabilization or immobilization in ER. The search phrase used various combinations of the keywords/phrases “primary closed reduction,”“anterior shoulder dislocation,”“traumatic,”“primary,”“treatment,”“management,”“immobilization,”“external rotation,”“surgical,”“operative,”“nonoperative,” and “conservative.” Inclusion criteria included patients undergoing treatment for primary anterior glenohumeral joint dislocation with either immobilization in ER or arthroscopic stabilization. Rates of recurrent instability, subsequent stabilization surgery, return to sports, positive postintervention apprehension tests, and patient-reported outcomes were evaluated. Results: The 30 studies that met inclusion criteria included 760 patients undergoing arthroscopic stabilization (mean age, 23.1 years; mean follow-up time, 55.1 months) and 409 patients undergoing immobilization in ER (mean age, 29.8 years; mean follow-up time, 28.8 months). Overall, 8.8% of operative patients experienced recurrent instability at latest follow-up compared with 21.3% of patients who had undergone ER immobilization (P < .0001). Similarly, 5.7% of operative patients had undergone a subsequent stabilization procedure at latest follow-up compared with 11.3% of patients who had undergone ER immobilization (P = .0015). A higher rate of return to sports was found in the operative group (P < .05), but no other differences were found between groups. Conclusion: Patients undergoing arthroscopic treatment for primary anterior glenohumeral dislocation with arthroscopic stabilization can be expected to experience significantly lower rates of recurrent instability and subsequent stabilization procedures compared with patients undergoing ER immobilization.