Background: The Human T-Lymphotropic Virus type 1c subtype (HTLV-1c) is highly endemic to central Australia where the most frequent complication of HTLV-1 infection in Indigenous Australians is bronchiectasis. We carried out a prospective study to quantify the prognosis of HTLV-1c infection and chronic lung disease and the risk of death according to the HTLV-1c proviral load (pVL). Methodology/Principal findings: 840 Indigenous adults (discharge diagnosis of bronchiectasis, 154) were recruited to a hospital-based prospective cohort. Baseline HTLV-1c pVL were determined and the results of chest computed tomography and clinical details reviewed. The odds of an association between HTLV-1 infection and bronchiectasis or bronchitis/bronchiolitis were calculated, and the impact of HTLV-1c pVL on the risk of death was measured. Radiologically defined bronchiectasis and bronchitis/bronchiolitis were significantly more common among HTLV-1-infected subjects (adjusted odds ratio = 2.9; 95% CI, 2.0, 4.3). Median HTLV-1c pVL for subjects with airways inflammation was 16-fold higher than that of asymptomatic subjects. There were 151 deaths during 2,140 person-years of follow-up (maximum follow-up 8.13 years). Mortality rates were higher among subjects with HTLV-1c pVL ≥1000 copies per 105peripheral blood leukocytes (log-rank χ2(2df) = 6.63, p = 0.036) compared to those with lower HTLV-1c pVL or uninfected subjects. Excess mortality was largely due to bronchiectasis-related deaths (adjusted HR 4.31; 95% CI, 1.78, 10.42 versus uninfected). Conclusion/Significance: Higher HTLV-1c pVL was strongly associated with radiologically defined airways inflammation and with death due to complications of bronchiectasis. An increased risk of death due to an HTLV-1 associated inflammatory disease has not been demonstrated previously. Our findings indicate that mortality associated with HTLV-1c infection may be higher than has been previously appreciated. Further prospective studies are needed to determine whether these results can be generalized to other HTLV-1 endemic areas.