Background Induction of labour is a common obstetric procedure. Both mechanical (eg, Foley catheters) and pharmacological methods (eg, prostaglandins) are used for induction of labour in women with an unfavourable cervix. We aimed to compare the effectiveness and safety of induction of labour with a Foley catheter with induction with vaginal prostaglandin E2 gel. Methods We did an open-label, randomised controlled trial in 12 hospitals in the Netherlands between Feb 10, 2009, and May 17, 2010. We enrolled women with a term singleton pregnancy in cephalic presentation, intact membranes, an unfavourable cervix, an indication for induction of labour, and no prior caesarean section. Participants were randomly allocated by an online randomisation system to induction of labour with a 30 mL Foley catheter or vaginal prostaglandin E2 gel (1: 1 ratio). Because of the nature of the intervention this study was not blinded. The primary outcome was caesarean section rate. Secondary outcomes were maternal and neonatal morbidity and time from intervention to birth. All analyses were done on an intention-to-treat basis. We also did a meta-analysis that included our trial. The trial was registered with the Dutch trial registry, number NTR 1646. Findings 824 women were allocated to induction of labour with a Foley catheter (n=412) or vaginal prostaglandin E2 gel (n=412). Caesarean section rates were much the same between the two groups (23% vs 20%, risk ratio [RR] 1.13, 95% CI 0.87-1.47). A meta-analysis including our trial data confirmed that a Foley catheter did not reduce caesarean section rates. We recorded two serious maternal adverse events, both in the prostaglandin group: one uterine perforation and one uterine rupture. Interpretation In women with an unfavourable cervix at term, induction of labour with a Foley catheter is similar to induction of labour with prostaglandin E2 gel, with fewer maternal and neonatal side-effects.