Background: in 2002, the Transverse Myelitis Consortium Working Group (TMCWG) proposed the diagnostic criteria for idiopathic acute transverse myelitis (IATM) to delimit and unify this group of patients. This study aimed to describe the conversion rate to multiple sclerosis (MS) and variables associated with conversion, and to analyze functional outcome and prognostic factors associated with functional recovery in patients who fulfilled the current TMCWG criteria for definite and possible IATM. Methods: eighty-seven patients diagnosed with IATM between 1989 and 2011 were retrospectively reviewed. Two patients with positive neuromyelitis optica IgG serum antibodies were excluded. Epidemiological, clinical, laboratory, magnetic resonance imaging (MRI) data and outcome of 85 patients were analyzed. Results: eleven (13%) patients converted to MS after a median follow-up of 2.9 years (interquartile range 1.0-4.8). Early-age onset of symptoms was related to conversion to MS. Only 9.4% of patients with IATM were unable to walk unassisted at the end of follow-up. Urinary sphincter dysfunction (odds ratio [OR] 3.37, 95% confidence interval [CI] 1.04-10.92) and longitudinally extensive transverse myelitis (LETM) on MRI (OR 12.34, 95% CI 3.38-45.00) were associated with a poorer outcome (Rankin ≥ 2). Conclusions: at least 13% of patients who fulfill the TMCWG criteria for definite and possible IATM will convert to MS. Functional recovery in IATM is poorer in patients with urinary sphincter dysfunction at admission or LETM on MRI.