To evaluate the effect of Lugol's Iodine (LI) on angiogenic characteristics and postthyroidectomy morbidity in patients with Graves' Disease (GD). Medical records of 153 patients, who underwent thyroidectomies for GD between 1987 and 2006 were reviewed. LI in addition to antithyroid drugs (ATD) was administered to 16 toxic Graves' cases (group I), while 137 received ATD only (group II). In order to evaluate thyroid vascularity, immunohistochemical staining (IHS) for VEGF and CD31 for assessing microvessel density (MVD) were performed in group I, 20 random cases of group II, and 7 stochastic patients with non-toxic goiter (group III). Early postoperative complications were significantly higher in group I compared to group II: (transient recurrent nerve palsy (P < 0.04), transient hypocalcemia (P < 0.02), and postoperative bleeding (P < 0.003)). Meanwhile permanent complications were not significantly different. VEGF-IHS revealed ten patients of group I (62.5%) to have positive staining compared to only 3 (15%) of group II. All patients of group III stained positive. The expression of VEGF was more intense in group I as compared to group II (P < 0.02). However, no significant difference of MVD among all groups was recorded. Preoperative LI treatment may be associated with increased early postoperative morbidity and did not affect thyroid vascularity.