Abstract Background Immune checkpoint inhibitors (ICIs) are an important therapeutic pillar in metastatic urothelial carcinoma (mUC). The occurrence of immune-related adverse events (irAEs) appears to be associated with improved outcomes in observational studies. However, these associations are likely affected by immortal time bias and do not represent causal effects. The aim of this study was to assess the effect of irAEs on outcomes while correcting for immortal time bias, using target trial emulation (TTE). Methods TTE was contrasted to adjusted naïve and time-updated Cox models. We performed a multi-institutional retrospective study involving mUC patients under ICI. The primary objective was to assess the impact of irAEs on progression-free survival (PFS) and overall survival (OS). Secondary endpoints included the influence of irAEs on objective response rates (ORRs) to ICI and the influence of systemic corticosteroids on outcomes. Results Among 335 patients (median age: 69 yrs), 69.6% received ICI in the second line or further lines. During a median follow-up of 21.1 months, 122 (36.4%) patients developed irAEs of any grade (grade ≥ 3: 14.9%). Hazard ratios (HRs) for PFS ranged from 0.37 for naïve adjusted Cox model to 0.88 (95% confidence interval (CI), 0.59–1.30) with time-updated covariates, and from 0.41 to 1.10 (95% CI, 0.69–1.75) for OS. TTE accounting for immortal time bias yielded a HR of 1.02 (95% CI, 0.72–1.44) for PFS, and 0.90 (95% CI, 0.62–1.30) for OS. In contrast to the naïve Cox model (HR = 2.26, 95% CI 1.26–4.05), the presence of irAEs was no longer a predictive factor for improved ORR in time-updated Cox models (HR = 1.27, 95% CI 0.68–2.36) and TTE (HR = 1.43, 95% CI 0.89–2.29). In patients with irAEs, systemic corticosteroids did not negatively impact survival. Conclusion Using TTE, we were able to show that the occurrence of irAEs is no longer associated with better survival or improved response rates to ICI in mUC patients, in contrast to the naïve analysis. These findings demonstrate that TTE is a suitable formal framework to avoid immortal time bias in studies with time-dependent non-interventional exposures. Graphical abstract