Background In the UK, patients with one or two adenomas, of which at least one is ≥ 10 mm in size, or three or four small adenomas, are deemed to be at intermediate risk of colorectal cancer (CRC) and referred for surveillance colonoscopy 3 years post polypectomy. However, colonoscopy is costly, can cause discomfort and carries a small risk of complications. Objectives To determine whether or not annual faecal immunochemical tests (FITs) are effective, acceptable and cost saving compared with colonoscopy surveillance for detecting CRC and advanced adenomas (AAs). Design Diagnostic accuracy study with health psychology assessment and economic evaluation. Setting Participants were recruited from 30 January 2012 to 30 December 2013 within the Bowel Cancer Screening Programme in England. Participants Men and women, aged 60–72 years, deemed to be at intermediate risk of CRC following adenoma removal after a positive guaiac faecal occult blood test were invited to participate. Invitees who consented and returned an analysable FIT were included. Intervention We offered participants quantitative FITs at 1, 2 and 3 years post polypectomy. Participants testing positive with any FIT were referred for colonoscopy and not offered further FITs. Participants testing negative were offered colonoscopy at 3 years post polypectomy. Acceptibility of FIT was assessed using discussion groups, questionnaires and interviews. Main outcome measures The primary outcome was 3-year sensitivity of an annual FIT versus colonoscopy at 3 years for detecting advanced colorectal neoplasia (ACN) (CRC and/or AA). Secondary outcomes included participants’ surveillance preferences, and the incremental costs and cost-effectiveness of FIT versus colonoscopy surveillance. Results Of 8008 invitees, 5946 (74.3%) consented and returned a round 1 FIT. FIT uptake in rounds 2 and 3 was 97.2% and 96.9%, respectively. With a threshold of 40 µg of haemoglobin (Hb)/g faeces (hereafter referred to as µg/g), positivity was 5.8% in round 1, declining to 4.1% in round 3. Over three rounds, 69.2% (18/26) of participants with CRC, 34.3% (152/443) with AAs and 35.6% (165/463) with ACN tested positive at 40 µg/g. Sensitivity for CRC and AAs increased, whereas specificity decreased, with lower thresholds and multiple rounds. At 40 µg/g, sensitivity and specificity of the first FIT for CRC were 30.8% and 93.9%, respectively. The programme sensitivity and specificity of three rounds at 10 µg/g were 84.6% and 70.8%, respectively. Participants’ preferred surveillance strategy was 3-yearly colonoscopy plus annual FITs (57.9%), followed by annual FITs with colonoscopy in positive cases (31.5%). FIT with colonoscopy in positive cases was cheaper than 3-yearly colonoscopy (£2,633,382), varying from £485,236 (40 µg/g) to £956,602 (10 µg/g). Over 3 years, FIT surveillance could miss 291 AAs and eight CRCs using a threshold of 40 µg/g, or 189 AAs and four CRCs using a threshold of 10 µg/g. Conclusions Annual low-threshold FIT with colonoscopy in positive cases achieved high sensitivity for CRC and would be cost saving compared with 3-yearly colonoscopy. However, at higher thresholds, this strategy could miss 15–30% of CRCs and 40–70% of AAs. Most participants preferred annual FITs plus 3-yearly colonoscopy. Further research is needed to define a clear role for FITs in surveillance. Future work Evaluate the impact of ACN missed by FITs on quality-adjusted life-years. Trial registration Current Controlled Trials ISRCTN18040196. Funding National Institute for Health Research (NIHR) Health Technology Assessment programme, NIHR Imperial Biomedical Research Centre and the Bobby Moore Fund for Cancer Research UK. MAST Group Ltd provided FIT kits.