Background: Optimal treatment remains uncertain for patients with cognitive impairment that persists or returns after standard IV antibiotic therapy for Lyme disease. Methods: Patients had well-documented Lyme disease, with at least 3 weeks of prior IV antibiotics, current positive IgG Western blot, and objective memory impairment. Healthy individuals served as controls for practice effects. Patients were randomly assigned to 10 weeks of double-masked treatment with IV ceftriaxone or IV placebo and then no antibiotic therapy. The primary outcome was neurocognitive performance at week 12—specifically, memory. Durability of benefit was evaluated at week 24. Group differences were estimated according to longitudinal mixed-effects models. Results: After screening 3368 patients and 305 volunteers, 37 patients and 20 healthy individuals enrolled. Enrolled patients had mild to moderate cognitive impairment and marked levels of fatigue, pain, and impaired physical functioning. Across six cognitive domains, a significant treatment-by-time interaction favored the antibiotic-treated group at week 12. The improvement was generalized (not specific to domain) and moderate in magnitude, but it was not sustained to week 24. On secondary outcome, patients with more severe fatigue, pain, and impaired physical functioning who received antibiotics were improved at week 12, and this was sustained to week 24 for pain and physical functioning. Adverse events from either the study medication or the PICC line were noted among 6 of 23 (26.1%) patients given IV ceftriaxone and among 1 of 14 (7.1%) patients given IV placebo; these resolved without permanent injury. Conclusion: IV ceftriaxone therapy results in short-term cognitive improvement for patients with posttreatment Lyme encephalopathy, but relapse in cognition occurs after the antibiotic is discontinued. Treatment strategies that result in sustained cognitive improvement are needed.