The purpose of this study was to expand and validate the cartilage damage index (CDI) to detect cartilage damage in the lateral tibiofemoral compartment. We used an iterative 3-step process to develop and validate the lateral CDI: development (100 knees), testing (80 knees), and validation (100 knees). The validation set included 100 knees from the Osteoarthritis Initiative that was enriched to include all grades of lateral joint space narrowing (JSN, 0–3). Measurement of the CDI was rapid at 7.4 (s.d. 0.73) minutes per knee pair (baseline and follow-up of one knee). The intratester reliability is good (intraclass correlation coefficient (3, 1 model) = 0.86 to 0.98). At baseline, knees with greater KL grade and lateral JSN had a lower mean CDI (i.e., greater cartilage damage). Baseline lateral CDI is associated with both lateral JSW (r = 0.81 to 0.85, p < 0.01) and HKA (r = −0.30 to −0.33, p < 0.05). The SRM is good (lateral femur SRM = −0.76; lateral tibia SRM = −0.73; lateral tibiofemoral total SRM = −0.87). The lateral tibiofemoral CDI quantification allows for rapid evaluation and is reliable and responsive, with good construct validity. It may be an efficient method to measure lateral tibiofemoral articular cartilage in large clinical and epidemiologic studies.