Rationale: Point-of-care (POC) diagnostics have potential to reduce pre-treatment loss to follow-up and delays to initiation of appropriate TB treatment. Objective: To evaluate the effect of a POC diagnostic strategy on initiation of appropriate TB treatment. Methods: A cluster randomised trial of adults with cough who were HIV positive and/or at high risk of drug-resistant TB. Two-week time blocks were randomised to two strategies (i) Xpert performed at district hospital laboratory (ii) POC Xpert performed at primary health care clinic. All participants provided two sputum specimens: one for Xpert and the other for culture as reference standard. The primary outcome was the proportion of culture-positive pulmonary TB (PTB) cases initiated on appropriate TB treatment within 30 days. Measurements and Main Results: Between August 22, 2011 and March 1, 2013, 36 two-week blocks were randomised and 1297 individuals were enrolled (646 in the laboratory arm, 651 in the POC arm); 159 (12.4%) had culture-positive PTB. The proportion of culture-positive PTB cases initiated on appropriate TB treatment within 30 days was 76.5% in the laboratory arm and 79·5% in the POC arm (odds ratio 1·13, 95% confidence interval [CI] 0·51-2.53, p = 0·76; risk difference 3.1%, 95% CI -16.2, 10.1). The median time to initiation of appropriate treatment was 7 days (laboratory) vs. 1 day (POC). Conclusions: POC positioning of Xpert led to more rapid initiation of appropriate TB treatment. Achieving one-stop diagnosis and treatment for all people with TB will require simpler, more sensitive diagnostics and broader strengthening of health systems. Clinical trial registration available at www.isrctn.com, ID ISRCTN18642314