Summary Background Pneumonia is more common in smokers compared with non-smokers. A high 1-year prevalence of lung cancer following hospitalization for pneumonia was demonstrated in heavy smokers. Aim To assess the association between hospitalization for pneumonia among ever-smokers and subsequent lung cancer risk. Design Retrospective analysis. Methods The study cohort included all ever-smokers aged 55–80 hospitalized for pneumonia between the years 2010–15 covered by a large medical insurer in Israel. Controls were matched to cases by age in a 4:1 ratio. The primary outcome was the association between hospitalization for pneumonia and subsequent 1-year incidence of lung cancer, adjusted for gender, smoking status (past/current) and pack years. Pre-specified sensitivity analyses excluded heavy smokers (smoking history of more than 30 pack years) and patients diagnosed with lung cancer within 30 days of hospitalization, as they probably had clinical or radiological findings suggestive of lung cancer, making them ineligible for screening. Results Lung cancer was identified in 275 of 12 807 (2.1%) patients following hospitalization for pneumonia and in 44 of 51 228 (0.1%) controls (adjusted odds ratio 22.46, 95% CI 16.29–30.96, P < 0.001). Among patients hospitalized for pneumonia, 1-year lung cancer incidence remained high after excluding heavy smokers and patients diagnosed within 30 days of the index date (1.3% and 1.4%, respectively). Conclusions Hospitalization for pneumonia is associated with high 1-year incidence of lung cancer in ever-smokers, supporting the important role of the widely used practice of performing follow up imaging post-pneumonia to exclude occult malignancy.