OBJECTIVE: To evaluate the clinical effectiveness of manual physiotherapy and/or exercise physiotherapy in addition to usual care for patients with osteoarthritis (OA) of the hip or knee. DESIGN: In this 2 × 2 factorial randomized controlled trial, 206 adults (mean age 66 years) who met the American College of Rheumatology criteria for hip or knee OA were randomly allocated to receive manual physiotherapy (n = 54), multi-modal exercise physiotherapy (n = 51), combined exercise and manual physiotherapy (n = 50), or no trial physiotherapy (n = 51). The primary outcome was change in the Western Ontario and McMaster osteoarthritis index (WOMAC) after 1 year. Secondary outcomes included physical performance tests. Outcome assessors were blinded to group allocation. RESULTS: Of 206 participants recruited, 193 (93.2%) were retained at follow-up. Mean (SD) baseline WOMAC score was 100.8 (53.8) on a scale of 0-240. Intention to treat analysis showed adjusted reductions in WOMAC scores at 1 year compared with the usual care group of 28.5 (95% confidence interval (CI) 9.2-47.8) for usual care plus manual therapy, 16.4 (-3.2 to 35.9) for usual care plus exercise therapy, and 14.5 (-5.2 to 34.1) for usual care plus combined exercise therapy and manual therapy. There was an antagonistic interaction between exercise therapy and manual therapy (P = 0.027). Physical performance test outcomes favoured the exercise therapy group. CONCLUSIONS: Manual physiotherapy provided benefits over usual care, that were sustained to 1 year. Exercise physiotherapy also provided physical performance benefits over usual care. There was no added benefit from a combination of the two therapies. TRIAL REGISTRATION NUMBER: Australian New Zealand Clinical Trials Registry ACTRN12608000130369.