This report describes a five-year-old boy with severe pulmonary hemorrhage caused by primary pulmonary hemosiderosis with cow's milk sensitivity. After failing to respond to corticosteroids and azathioprine, he dramatically improved after being given cyclophosphamide. He worsened after discontinuation of cyclophosphamide on two occasions and improved significantly with its reinstitution. Cyclophosphamide was continued for 14 months without further bleeding or adverse effects. The patient has remained in remission for nearly five years. Cyclophosphamide may be a life-saving alternative therapy for refractory pulmonary hemorrhage with pulmonary hemosiderosis.