Buruli ulcer is a chronic ulcerative disease of skin and subcutaneous tissues caused by infection with Mycobacterium ulcerans. Although Australian possums are known to be susceptible to Buruli ulcer, many aspects of the disease in possums, including welfare impacts, remain largely unreported. Severe clinical Buruli ulcer was identified in four common ringtail possums (Pseudocheirus peregrinus) from Melbourne, Victoria. All four possums were euthanised due to welfare concerns and poor prognosis, based on the presence of deep ulcerative lesions to paws, some of which exposed carpal or tarsal bones. These lesions were considered likely to cause partial or complete loss of limb function, which would severely affect the welfare and survival of these wild arboreal animals. Histologically, there was severe ulcerative necrotising pyogranulomatous dermatitis, panniculitis, and myositis, with intralesional acid-fast bacteria. M. ulcerans was detected by real-time PCR in all swabs and biological tissues collected from all four cases. Buruli ulcer may be an important and under-recognised cause of poor possum welfare in endemic areas. In addition to severe cutaneous lesions, infection extends to underlying bones and joints, and the systemic distribution of M. ulcerans throughout all major tissues and internal organs, as observed in these four cases, may further impact the health and fitness of infected possums. Further research is needed to investigate the epidemiology, pathogenesis and impacts of Buruli ulcer in possums, and to inform the design of interventions that may protect the health and welfare of possums and other affected animal species.