Differentiating between inflammatory bowel disease (IBD) and small intestinal lymphoma in cats is often difficult, especially when only endoscopic biopsy specimens are available for evaluation. However, a correct diagnosis is imperative for proper treatment and prognosis. A retrospective study was performed using surgical and endoscopic intestinal biopsy specimens from 63 cats with a history of chronic diarrhea or vomiting or weight loss. A diagnosis of lymphoma or inflammation was based on microscopic examination of hematoxylin and eosin (HE)-stained sections alone, HE-stained sections plus results of immunohistochemical labeling (IHC) for CD3e and CD79a, and HE staining, immunophenotyping, and polymerase chain reaction (PCR) results for B and/or T cell clonality. In addition, various histomorphologic parameters were evaluated for significant differences between lymphoma and IBD using Fisher's exact test. The sensitivity and specificity of each parameter in the diagnosis of lymphoma were also determined. Results of Bayesian statistical analysis demonstrated that combining histologic evaluation of small intestinal biopsy specimens with immunophenotyping and analysis of clonality of lymphoid infiltrates results in more accurate differentiation of neoplastic versus inflammatory lymphocytes. Important histologic features that differentiated intestinal lymphoma from IBD included lymphoid infiltration of the intestinal wall beyond the mucosa, epitheliotropism (especially intraepithelial nests and plaques), heterogeneity, and nuclear size of lymphocytes. Based on the results of this study, a stepwise diagnostic algorithm that first uses histologic assessment, followed by immunophenotyping and then PCR to determine clonality of the lymphocytes, was developed to more accurately differentiate between intestinal lymphoma and IBD.