Leflunomide is a disease-modifying anti-rheumatic drug (DMARD) used in the management of rheumatoid arthritis (RA) and psoriatic arthritis. Commonly reported adverse effects include diarrhea, nausea, hepatotoxicity, hypertension, and transient global hair loss; however, additional side effects may be associated with the medication not reported in the monograph. We describe a rare case of reversible alopecia areata (AA) associated with the use of leflunomide and provide a literature review of three published similar cases. We use the Naranjo adverse drug reaction score to show the AA in our case is a "probable" side effect of leflunomide. Currently, AA is not listed as an adverse effect in the leflunomide product monograph. However, it would appear that based on our case and the three other reported cases, the likelihood of AA being an adverse effect of leflunomide is at least possible to probable.