Objective: To determine the clinical outcome of bipolar disorder in a developing country setup. Method: After assessing 68 378 individuals, aged 15–49 years, in a double-sampling design in a rural community in Ethiopia, 312 patients with bipolar disorder were prospectively monitored with symptom rating scales and clinically for an average of 2.5 years. Results: Overall, 65.9% of the cohort experienced a relapse – 47.8% manic, 44.3% depressive and 7.7% mixed episodes – and 31.1% had persistent illness. Female gender predicted depressive relapse, while male gender predicted manic relapse. Being on psychotropic medication was associated with remission. Conclusion: This large community-based study confirms the relapsing nature of bipolar disorder and a tendency for chronicity. This may be partly because of lack of appropriate interventions in this setting; however, it may also indicate the underlying severity of the disorder irrespective of setting.