Objective Treatment of diffuse pigmented villonodular synovitis (DPVNS) of the knee is problematic and controversial with a high rate of morbidities and local recurrence. The purpose of this study is functional evaluation of patients with diffuse knee PVNS treated with combined surgical and external radiosynovectomy. Methods Between June 2011 and May 2015, twelve patients (four males and eight females) with DPVNS of the knee were treated by staged surgical synovectomy (arthroscopic anterior and open posterior) followed by low-dose external radiation. SF-36, Musculoskeletal Tumor Society (MSTS), Lysholm, International Knee Documentation Committee (IKDC) scores and range of motion (ROM) were assessed preoperatively and at the final follow-up. Results After a mean follow-up period of 46.7±15 (25–72) months, there were statistically significant improvement of ROM from 72.5±17.6 to 94.2±7.01, Lysholm score from 42.8±5.2 to 78.1±5.1, IKDC from 39.6±8.3 to 75.3±6, MSTS from 5.6±2.7 to 19.7±6.06 and SF-36 score from 29.4±7.5 to 72.3±17.5. Apart from limited range of motion, three mild complications were encountered (superficial wound infection, repeated effusion and transient neuropraxia). Conclusion Combined staged synovectomy and external radiotherapy provide functional improvement of the knee and quality of patients’ lives with low rate of recurrence for knee DPVNS cases. Level of evidence Prospective case series; level IV.