Lumbar spinal canal stenosis (LSS) and diffuse idiopathic skeletal hyperostosis (DISH) tend to develop in the elderly, resulting in an increased need for lumbar surgery. However, DISH may be a risk factor for poor clinical outcomes following lumbar decompression surgery, especially in patients with DISH extending to the lumbar segment (L-DISH). This study aimed to identify the prognostic factors of LSS with L-DISH and propose an optimal surgical management approach to improve clinical outcomes. Of 934 patients who underwent lumbar decompression surgery, 145 patients (15.5%) had L-DISH. In multivariate linear regression analysis of the JOA score improvement rate, the presence of vacuum phenomenon at affected segments (estimate: -15.14) and distance between the caudal end of L-DISH and decompressed/fused segments (estimate: 7.05) were independent prognostic factors. In logistic regression analysis of the surgical procedure with JOA improvement rate > 25% in L-DISH patients with both negative prognostic factors, the odds ratios of split laminotomy and short-segment fusion were 0.64 and 0.21, respectively, with conventional laminotomy as the reference. Therefore, to achieve better clinical outcomes in cases with decompression at the caudal end of L-DISH, decompression surgery without fusion sparing the osteoligamentous structures at midline should be considered as the standard surgery.