Genome-wide association studies have identified genetic markers in kallikrein-related peptidase 3 (KLK3) associated with prostate cancer. However, some of these markers are also associated with prostate-specific antigen (PSA) levels, so it is unclear whether the polymorphisms are causal or if the association with risk is solely due to detection bias through PSA screening. PSA is a biologically active serine protease, cleaving insulin-like growth factor-binding protein. We examined the association of single-nucleotide polymorphisms (SNPs) in KLK3 with prostate cancer risk, disease-specific survival and pre-diagnostic PSA levels in a case-control study nested within the Physicians' Health Study, which began in 1982, with over 27 years of follow-up. We genotyped SNPs spanning the entire KLK3 locus to capture common variation at high resolution. Six polymorphisms were significantly associated with prostate cancer incidence (P < 0.05); the odds ratios per minor allele ranged from 0.88 to 0.73. For four of these, the odds ratios were lower when restricting to cases diagnosed in the pre-PSA screening era (before 1989). The four alleles significantly associated with lower PSA levels were also associated with lower prostate cancer risk. KLK3 variants were not significantly associated with stage at diagnosis, risk of lethal cancer or survival. Our results suggest that detection bias due to the association of KLK3 variants with PSA levels cannot completely explain the association with prostate cancer risk. Understanding the mechanism by which genetic variation in KLK3 affects prostate cancer risk has important implications for study of the biological role of PSA in prostate tumorigenesis.