Mycobacterium leprae (M. leprae) infection causes nerve damage and the condition worsens often during and long after treatment. Clearance of bacterial antigens including lipoarabinomannan (LAM) during and after treatment in leprosy patients is slow. We previously demonstrated that M. leprae LAM damages peripheral nerves by in situ generation of the membrane attack complex (MAC). Investigating the role of complement activation in skin lesions of leprosy patients might provide insight into the dynamics of in situ immune reactivity and the destructive pathology of M. leprae. In this study, we analyzed in skin lesions of leprosy patients, whether M. leprae antigen LAM deposition correlates with the deposition of complement activation products MAC and C3d on nerves and cells in the surrounding tissue. Skin biopsies of paucibacillary (n = 7), multibacillary leprosy patients (n = 7), and patients with erythema nodosum leprosum (ENL) (n = 6) or reversal reaction (RR) (n = 4) and controls (n = 5) were analyzed. The percentage of C3d, MAC and LAM deposition was significantly higher in the skin biopsies of multibacillary compared to paucibacillary patients (p = <0.05, p = <0.001 and p = <0.001 respectively), with a significant association between LAM and C3d or MAC in the skin biopsies of leprosy patients (r = 0.9578, p< 0.0001 and r = 0.8585, p<0.0001 respectively). In skin lesions of multibacillary patients, MAC deposition was found on axons and co-localizing with LAM. In skin lesions of paucibacillary patients, we found C3d positive T-cells in and surrounding granulomas, but hardly any MAC deposition. In addition, MAC immunoreactivity was increased in both ENL and RR skin lesions compared to non-reactional leprosy patients (p = <0.01 and p = <0.01 respectively). The present findings demonstrate that complement is deposited in skin lesions of leprosy patients, suggesting that inflammation driven by complement activation might contribute to nerve damage in the lesions of these patients. This should be regarded as an important factor in M. leprae nerve damage pathology.