BACKGROUND This study was designed to evaluate the therapeutic outcome and early postoperative complications, especially pancreatitis, of endoscopic papillary balloon dilation (EPBD) and endoscopic sphincterotomy (EST) in patients with common bile duct stones in our department. METHODS One hundred eighty patients with common bile duct stones were randomized to undergo EPBD or EST. An 8-mm dilatation balloon was used for EPBD. Modified Cotton's criteria, in which relatively mild pancreatitis is also included as a complication, were used to determine the incidence of postoperative complications. RESULTS The rate of complete removal of stones was significantly higher in the EST group (95.6%) than in the EPBD group (86.6%); for stones less than 10 mm in diameter, however, the rate with EPBD (93.8%) was almost equivalent to that with EST (98.1%). According to modified Cotton's criteria, the incidence of postoperative pancreatitis was significantly higher in the EPBD group (16.7%) than in the EST group (6.7%). Bleeding was encountered in one patient (1.1%) in the EST group, but in none in the EPBD group. No fatal complication occurred in either the EPBD or the EST group. CONCLUSIONS Although EPBD appears to be comparable to EST for removal of small common bile duct stones, mild postoperative pancreatitis is more likely to occur with EPBD than with EST.