Reduction of a malunited femoral diaphyseal fracture can be achieved by osteotomy and immediate internal fixation or gradual skeletal traction followed by delayed internal fixation. We retrospectively reviewed 27 patients with malunited and shortened femur. Nine patients with mean shortening of 4.7 cm (2.5-10.0) underwent acute one-stage reduction and gained 2.5 to 5.0 cm length. Eighteen patients with mean shortening of 5.3 cm (3.5 to 9.0) underwent twostage reduction and gained 2.0 to 5.0 cm length. There was no paralysis in either group. No infection occurred in the one-stage procedure. Intramedullary fixation demonstrated superior results compares to plate fixation.