However, the impact of such a treatment strategy on antibiotic resistance is not yet known, researchers warned.
Dr Richard Albert and colleagues from the US COPD Clinical Research Network examined the effect of treatment on 1,142 patients.
Patients enrolled in the trial were at increased risk of COPD exacerbations but had no hearing impairment.
Also, because of the effect of azithromycin on QT interval, patients at apparent risk of prolongation of corrected QT interval were excluded.
Patients were randomised to receive either azithromycin 250mg daily or a placebo for one year.
Those given azithromycin experienced exacerbation after an average of 266 days, compared with 174 days for patients given placebo.
Frequency of exacerbations was 1.48 per patient-year in the azithromycin group, compared with 1.83 in the placebo group. Patients given azithromycin were 27% less likely to experience an exacerbation within the year of treatment.
However, hearing decrements were experienced by 25% of the azithromycin group, compared with 20 per cent of the placebo group.
The researchers said: 'Given the deleterious effects of acute exacerbations of COPD with respect to the risk of death, quality of life, loss of lung function, and cost of care, adding azithromycin to the treatment regimen of patients who have had an acute exacerbation of COPD within the previous year or who require supplemental oxygen is a valuable option.'
The researchers said patients should be screened for risk of prolongation of corrected QT interval and have their hearing monitored.
They added: 'It should be recognised that the long-term effects of this treatment on microbial resistance in the community are not known.'