Conservative management of 166 Colles' fractures was associated with a 12% rate of late compression neuropathies (mean follow-up period, 28 months). Compression of the median nerve (8%) was twice as common as ulnar nerve compression (4%). Eighty-five percent of the patients with median nerve compression had malunion with radial collapse with or without other deformities (dorsal angulation/radial displacement). Patients with ulnar nerve compression had either malunion with radial collapse or volar subluxation of the ulnar head in those fractures that healed with dorsal angulation. Patients without nerve complications showed a significantly lower rate of malunions. These results demonstrate that anatomic derangements play a role in the development of late compression neuropathies following Colles' fractures.