The comparative effectiveness of decompression plus lumbar facet arthroplasty versus decompression plus instrumented lumbar spinal fusion in patients with lumbar spinal stenosis and grade-I degenerative spondylolisthesis is unknown. In this randomized, controlled, Food and Drug Administration Investigational Device Exemption trial, we assigned patients who had single-level lumbar spinal stenosis and grade-I degenerative spondylolisthesis to undergo decompression plus lumbar facet arthroplasty (arthroplasty group) or decompression plus fusion (fusion group). The primary outcome was a predetermined composite clinical success score. Secondary outcomes included the Oswestry Disability Index (ODI), visual analog scale (VAS) back and leg pain, Zurich Claudication Questionnaire (ZCQ), Short Form (SF)-12, radiographic parameters, surgical variables, and complications. A total of 321 adult patients were randomized in a 2:1 fashion, with 219 patients assigned to undergo facet arthroplasty and 102 patients assigned to undergo fusion. Of these, 113 patients (51.6%) in the arthroplasty group and 47 (46.1%) in the fusion group who had either reached 24 months of postoperative follow-up or were deemed early clinical failures were included in the primary outcome analysis. The arthroplasty group had a higher proportion of patients who achieved composite clinical success than did the fusion group (73.5% versus 25.5%; p < 0.001), equating to a between-group difference of 47.9% (95% confidence interval, 33.0% to 62.8%). The arthroplasty group outperformed the fusion group in most patient-reported outcome measures (including the ODI, VAS back pain, and all ZCQ component scores) at 24 months postoperatively. There were no significant differences between groups in surgical variables or complications, except that the fusion group had a higher rate of developing symptomatic adjacent segment degeneration. Among patients with lumbar spinal stenosis and grade-I degenerative spondylolisthesis, lumbar facet arthroplasty was associated with a higher rate of composite clinical success than fusion was at 24 months postoperatively. Therapeutic Level I . See Instructions for Authors for a complete description of levels of evidence.