Stable thoracolumbar fracture is a common injury. The factors that determine its outcome are unclear. Aspects of injury severity were analysed for their ability to predict outcome by controlling other outcome-affecting factors (patient's pre-injury health status, legal aspects, associated injuries, etc.). No reliable disc injury severity grading system was available and therefore a new system was developed. A prospective observational study of 44 conservatively treated patients with stable fractures between T11 and L5 was conducted. Bony injury severity was scored based on comminution, apposition and kyphosis parameters. Disc injury severity was scored by the new scale based on variables – Herniation, Indentation, Height decrease and Signal change – seen in MRI. Ten outcome domains (five domains of pain and function each) were assessed at 1 to 2 years from injury. The data was analysed by non-parametric correlation and stepwise-linear regression analysis to assess the predictive value of different variables (patient factors, injury factors and social factor) to outcome. The correlation coefficients between injury severity and outcome were consistently higher with disc injury severity than bony. Disc injury severity showed highest predictive value for both pain (29%) and functional (16%) outcomes, whereas the bony injury severity parameters (kyphosis, etc.) and the posterior ligament injury severity provided no prediction of outcome. According to AO classification, the fractures were A1, A2, A3 and B1; in this spectrum of injuries, the AO classification had no prediction of outcome. The disc injury score also had a good predictive value for final disc degeneration. Disc injury severity should be gauged in advising prognosis and treatment. The new disc injury severity grading system showed good construct validity.