The purpose of this population-based prospective cohort study was to examine the effect of hormone-replacement therapy (HRT) on the risk of fractures. The study population consisted of 7217 postmenopausal women aged 47-56 years (mean, 53.3 years) at baseline from data taken from the Kuopio Osteoporosis Risk Factor and Prevention Study (OSTPRE) in Finland. We compared fracture incidences between HRT users and nonusers. A total of 679 (9.4%) women recorded validated fractures during the 5-year follow-up. Of these, 268 (39%) women had a distal forearm fracture. Two thousand six hundred seventy women (37%) had used HRT >6 months during the follow-up--one-half of them continuously. The relative risk, estimated as hazard ratio with Cox regression, was 0.69 (95% CI, 0.58-0.82) for any fracture and 0.49 (0.36-0.66) for distal forearm fracture among HRT users as compared with never-users. After adjusting for age, body mass index (BMI), number of chronic health disorders, fracture history, and time since menopause (independent risk factors) the corresponding risks were 0.67 (0.55-0.81) and 0.53 (0.37-0.74), respectively. The respective adjusted risks for continuous HRT users were 0.62 (0.48-0.79) and 0.41 (0.26-0.67). The adjusted risk of other than distal forearm fracture was 0.74 (0.55-0.98). The results suggest that HRT has a beneficial effect on prevention of fractures in general and on that of distal forearm fracture in particular in early postmenopausal women.