Inflammation in fibrosis areas (i-IF/TA) of kidney allografts is associated with allograft loss; however, its diagnostic significance remains to be determined. We investigated the clinicohistologic phenotype and determinants of i-IF/TA in a prospective cohort of 1539 kidney recipients undergoing evaluation of i-IF/TA and tubulitis in atrophic tubules (t-IF/TA) on protocol allograft biopsies performed at 1 year posttransplantation. We considered donor, recipient, and transplant characteristics, immunosuppression, and histological diagnoses in 2260 indication biopsies performed within the first year posttransplantation. Nine hundred forty-six (61.5%) patients presented interstitial fibrosis/tubular atrophy (IF/TA Banff grade > 0) at 1 year posttransplant, among whom 394 (41.6%) showed i-IF/TA. i-IF/TA correlated with concurrent t-IF/TA (P < .001), interstitial inflammation (P < .001), tubulitis (P < .001), total inflammation (P < .001), peritubular capillaritis (P < .001), interstitial fibrosis (P < .001), and tubular atrophy (P = .02). The independent determinants of i-IF/TA were previous T cell-mediated rejection (TCMR) (P < .001), BK virus nephropathy (P = .007), steroid therapy (P = .039), calcineurin inhibitor therapy (P = .011), inosine-5'-monophosphate dehydrogenase inhibitor therapy (P = .011), HLA-B mismatches (P = .012), and HLA-DR mismatches (P = .044). TCMR patients with i-IF/TA on posttreatment biopsy (N = 83/136, 61.0%) exhibited accelerated progression of IF/TA over time (P = .01) and decreased 8-year allograft survival (70.8% vs 83.5%, P = .038) compared to those without posttreatment i-IF/TA. Our results support that i-IF/TA may represent a manifestation of chronic active TCMR.