Paramagnetic rim lesions (PRLs) are an emerging biomarker for multiple sclerosis representing chronic, low-grade intraparenchymal brain inflammation. In addition to associating with greater disease severity, PRLs may be diagnostically supportive. Our aim in this study was to determine PRL specificity and sensitivity for discriminating multiple sclerosis from its diagnostic mimics using real-world clinical diagnostic and imaging data. This is a retrospective, cross-sectional analysis of a longitudinal cohort of patients with prospectively collected observational data. Patients were included if they underwent clinical evaluation in our academic neuroimmunology centre and had an available MRI scan from the same clinical 3-T magnet that included a T2*-weighted sequence with susceptibility post-processing (Susceptibility Weighted ANgiography protocol, General Electric). Susceptibility imaging-derived filtered phase maps and corresponding T2-fluid attenuated inversion recovery images were manually reviewed to determine PRLs. PRLs were categorized as 'definite', 'probable' or 'possible' based on modified, recent consensus criteria. We hypothesized that PRLs would convey a high specificity to discriminate multiple sclerosis from its MRI mimics. Five hundred seventy-four patients were evaluated in total: 473 with multiple sclerosis, 53 with non-inflammatory neurological disease and 48 with other inflammatory neurological disease. Identification of 'definite' or 'probable' PRL provided a specificity of 98% to discriminate multiple sclerosis from non-inflammatory neurological disease and other inflammatory neurological disease; sensitivity was 36%. Interrater agreement was almost perfect for definite/probable identification at a subject level. PRLs convey high specificity for multiple sclerosis and can aid in the diagnostic evaluation. Modest sensitivity limits their use as single diagnostic indicators. Including lesions with lower confidence ('possible') rapidly erodes specificity and should be interpreted with caution given the potential harms associated with misdiagnosis.