Objective: People with posttraumatic stress disorder (PTSD) commonly report difficulties with sexual desire and other aspects of sexual functioning, but it is currently unknown if people who respond to psychotherapy for PTSD also report improvements in sexual desire. Method: One hundred and eighty-seven veterans with PTSD received prolonged exposure (PE) therapy at two outpatient PTSD specialty clinics and completed measures of PTSD symptoms (the PTSD Checklist - Military Version) and sexual desire (item 21 of the Beck Depression Inventory - Second Edition) repeatedly throughout the course of treatment. Results: The results of a conditional generalized mixed ordinal regression model showed a significant interaction between weeks in treatment and PTSD treatment response in predicting change in sexual desire across the course of treatment. Specifically, PTSD treatment responders reported improvement in sexual desire over the course of treatment, whereas nonresponders did not show changes in sexual desire over time. However, the effect of PTSD treatment response was no longer significant when accounting for severity of depression at the start of treatment. Participants reporting more severe depression at the start of treatment reported less improvement in sexual desire, regardless of PTSD symptom response. Conclusions: People with PTSD who respond to PE also report improvements in sexual desire over time, indicating that response to PE is associated with improved sexual desire, but the effect is complicated by the presence of co-occurring depression symptomatology.