Background: Teriflunomide is an oral disease-modifying therapy approved for treatment of relapsing or relapsing-remitting multiple sclerosis. We aimed to provide further evidence for the safety and efficacy of teriflunomide in patients with relapsing multiple sclerosis. Methods: This international, randomised, double-blind, placebo-controlled, phase 3 study enrolled adults aged 18-55 years with relapsing multiple sclerosis, one or more relapse in the previous 12 months or two or more in the previous 24 months but no relapse in the previous 30 days, and an Expanded Disability Status Scale (EDSS) score of 5·5 points or less. Patients were recruited from 189 sites in 26 countries and randomly assigned (1:1:1) to once-daily placebo, teriflunomide 7 mg, or teriflunomide 14 mg via an interactive voice recognition system. Treatment duration was variable, ending 48 weeks after the last patient was included. The primary endpoint was annualised relapse rate (number of relapses per patient-year) and the key secondary endpoint was time to sustained accumulation of disability (an EDSS score increase of at least 1 EDSS point sustained for a minimum of 12 weeks), both analysed in the modified intention-to-treat population (all patients who received at least one dose of assigned study medication). This study is registered with ClinicalTrials.gov, number NCT00751881. Findings: Between Sept 17, 2008, and Feb 17, 2011, 1169 patients were randomly assigned to a treatment group, of whom 388, 407, and 370 patients received at least one dose of placebo, teriflunomide 7 mg, or teriflunomide 14 mg, respectively. By the end of the study, the annualised relapse rate was higher in patients assigned to placebo (0·50 [95% CI 0·43-0·58]) than in those assigned to teriflunomide 14 mg (0·32 [0·27-0·38]; p=0·0001) or teriflunomide 7 mg (0·39 [0·33-0·46]; p=0·0183). Compared with placebo, teriflunomide 14 mg reduced the risk of sustained accumulation of disability (hazard ratio [HR] 0·68 [95% CI 0·47-1·00]; log-rank p=0·0442); however, teriflunomide 7 mg had no effect on sustained accumulation of disability (HR 0·95 [0·68-1·35]; log-rank p=0·7620). The most common adverse events were alanine aminotransferase increases (32 [8%] of 385 patients in the placebo group vs 46 [11%] of 409 patients in the teriflunomide 7 mg group vs 52 [14%] of 371 patients in the teriflunomide 14 mg group), hair thinning (17 [4%] vs 42 [10%] vs 50 [13%]), and headache (42 [11%] vs 60 [15%] vs 46 [12%]). Incidence of serious adverse events was similar in all treatment groups (47 [12%] vs 52 [13%] vs 44 [12%]). Four deaths occurred, none of which was considered to be related to study drug (respiratory infection in the placebo group, traffic accident in the teriflunomide 7 mg group, and suicide and septicaemia due to Gram-negative infection complicated by disseminated intravascular coagulopathy in the teriflunomide 14 mg group). Interpretation: Teriflunomide 14 mg was associated with a lower relapse rate and less disability accumulation compared with placebo, with a similar safety and tolerability profile to that reported in previous studies. These results confirm the dose effect reported in previous trials and support the use of teriflunomide 14 mg in patients with relapsing multiple sclerosis. Funding: Genzyme, a Sanofi company.