To examine clinical outcomes of theophylline use in patients with chronic obstructive pulmonary disease (COPD) receiving inhaled corticosteroids (ICS) and long-acting beta-2 agonists (LABA). Electronic data from five hospitals located in Northern Thailand between January 2011 and December 2015 were retrospectively collected. Propensity score (PS) matching (2:1 ratio) technique was used to minimize confounding factors. The primary outcome was overall exacerbations. Secondary outcomes were exacerbation not leading to hospital admission, hospitalization for exacerbation, hospitalization for pneumonia, and all-cause hospitalizations. Cox's proportional hazards models were used to estimate adjusted hazard ratio (aHR) and 95% confidence interval (CI). After PS matching, of 711 patients with COPD (mean age: 70.1 years; 74.4% male; 60.8% severe airflow obstruction), 474 theophylline users and 237 non-theophylline users were included. Mean follow-up time was 2.26 years. Theophylline significantly increased the risk of overall exacerbation (aHR: 1.48, 95% CI: 1.11-1.96; p = 0.008) and exacerbation not leading to hospital admission (aHR: 1.47, 95% CI: 1.06-2.03; p = 0.020). Theophylline use did not significantly increase the risk of hospitalization for exacerbation (aHR: 1.11, 95% CI: 0.79-1.58; p = 0.548), hospitalization for pneumonia (aHR: 1.28, 95% CI: 0.89-1.84; p = 0.185), and all-cause hospitalizations (aHR: 1.03, 95% CI: 0.80-1.33; p = 0.795). Theophylline use as add-on therapy to ICS and LABA might be associated with an increased risk for overall exacerbation in patients with COPD. A large-scale prospective study of theophylline use investigating both safety and efficacy is warranted.