OBJECTIVE: To evaluate the effect of surgical excision, performed after biopsy diagnosis of dysplastic nevus, on final diagnosis, melanoma prevention, and melanoma detection. DESIGN, SETTING, AND PARTICIPANTS: Outcome study using retrospective review conducted in an academic dermatopathology practice (Boston Medical Center Skin Pathology Laboratory) that receives specimens from community and academic practices across the United States. Consecutive patient pathology samples of dysplastic nevi and cutaneous melanomas evaluated between September 1, 1999 and March 1, 2011, and identified using systematized nomenclature of medicine codes were included. MAIN OUTCOMES AND MEASURES: In dysplastic nevi cases, the rate of clinically significant change in diagnosis and the rate of melanoma detection as a result of excision. In melanoma cases, the rate and characteristics of association with dysplastic nevus. RESULTS: Of dysplastic nevi, 196 of 580 (34%) showed a positive biopsy margin, increasing with grade of atypia (P < .001); 127 of 196 with positive biopsy margin received excision (65%), performed more often as grade of atypia increased (P < .001). Two excisions (2 of 127, 1.6%) resulted in a clinically significant change in diagnosis, from biopsy-diagnosed moderately-to-severely dysplastic nevi before excision to melanoma in situ after excision. In melanomas (n = 216), in situ and superficial spreading subtypes were more often associated with dysplastic nevi (20% and 18%, respectively) (P = .002), most often of moderate-to-severe or severe grade. CONCLUSIONS AND RELEVANCE: Excision of biopsy-diagnosed mildly or moderately dysplastic nevi is unlikely to result in a clinically significant change in diagnosis, and risk of transformation to melanoma appears very low. Moderately-to-severely and severely dysplastic nevi are more often associated with melanoma, and excision may be beneficial for melanoma detection or prevention.