Purpose To determine the prognostic value of peritumoral edema identified at preoperative breast magnetic resonance (MR) imaging for disease recurrence in patients with invasive breast cancer. Materials and Methods Between January 2011 and December 2012, 353 women (median age, 49 years; range, 27-77 years) with invasive breast cancer who had undergone preoperative MR imaging and mastectomy or breast-conserving surgery were identified. Two radiologists independently reviewed peritumoral edema on the basis of the degree of the signal intensity surrounding the tumor on T2-weighted images. The association of disease recurrence with peritumoral edema and clinical-pathologic features was assessed by using the multivariate Cox proportional hazards model and the integrated discrimination improvement (IDI) and continuous net reclassification improvement (NRI) indexes. Results Twenty-four patients (6.8%) had disease recurrence after 27.2 months of median follow-up. At multivariate analysis, higher N stage (hazard ratio = 4.84, P = .002) and the presence of lymphovascular invasion (hazard ratio = 2.48, P = .044) and peritumoral edema (hazard ratio = 2.77, P = .022) were independent factors associated with disease recurrence. IDI and continuous NRI showed significant improvement in the accuracy of the association with disease recurrence when peritumoral edema was added to established clinical-pathologic features (IDI = 0.061, P < .001; continuous NRI = 0.334, P = .012). Conclusion Peritumoral edema identified at preoperative MR imaging is independently associated with disease recurrence. Peritumoral edema assessment may provide better prognostication in patients with invasive breast cancer. © RSNA, 2018.