BACKGROUND: In most resource limited settings, new tuberculosis (TB) patients are usually treated as outpatients. We sought to investigate the reasons for hospitalisation and the predictors of poor treatment outcomes and mortality in a cohort of hospitalized new TB patients in Kampala, Uganda. METHODS AND FINDINGS: Ninety-six new TB patients hospitalised between 2003 and 2006 were enrolled and followed for two years. Thirty two were HIV-uninfected and 64 were HIV-infected. Among the HIV-uninfected, the commonest reasons for hospitalization were low Karnofsky score (47%) and need for diagnostic evaluation (25%). HIV-infected patients were commonly hospitalized due to low Karnofsky score (72%), concurrent illness (16%) and diagnostic evaluation (14%). Eleven HIV uninfected patients died (mortality rate 19.7 per 100 person-years) while 41 deaths occurred among the HIV-infected patients (mortality rate 46.9 per 100 person years). In all patients an unsuccessful treatment outcome (treatment failure, death during the treatment period or an unknown outcome) was associated with duration of TB symptoms, with the odds of an unsuccessful outcome decreasing with increasing duration. Among HIV-infected patients, an unsuccessful treatment outcome was also associated with male sex (P = 0.004) and age (P = 0.034). Low Karnofsky score (aHR = 8.93, 95% CI 1.88 - 42.40, P = 0.001) was the only factor significantly associated with mortality among the HIV-uninfected. Mortality among the HIV-infected was associated with the composite variable of CD4 and ART use, with patients with baseline CD4 below 200 cells/µL who were not on ART at a greater risk of death than those who were on ART, and low Karnofsky score (aHR = 2.02, 95% CI 1.02 - 4.01, P = 0.045). CONCLUSION: Poor health status is a common cause of hospitalisation for new TB patients. Mortality in this study was very high and associated with advanced HIV Disease and no use of ART.