Background: There is interest in expanding ART to prevent HIV transmission, but in the group with the highest levels of ART use, men-who-have-sex-with-men (MSM), numbers of new infections diagnosed each year have not decreased as ARTcoverage has increased for reasons which remain unclear. Methods: We analysed data on the HIV-epidemic in MSM in the UK from a range of sources using an individual-based simulation model. Model runs using parameter sets found to result in good model fit were used to infer changes in HIV-incidence and risk behaviour. Results: HIV-incidence has increased (estimated mean incidence 0.30/100 person-years 1990-1997, 0.45/100 py 1998-2010), associated with a modest (26%) rise in condomless sex. We also explored counter-factual scenarios: had ART not been introduced, but the rise in condomless sex had still occurred, then incidence 2006-2010 was 68% higher; a policy of ART initiation in all diagnosed with HIV from 2001 resulted in 32% lower incidence; had levels of HIV testing been higher (68% tested/year instead of 25%) incidence was 25% lower; a combination of higher testing and ART at diagnosis resulted in 62% lower incidence; cessation of all condom use in 2000 resulted in a 424% increase in incidence. In 2010, we estimate that undiagnosed men, the majority in primary infection, accounted for 82% of new infections. Conclusion: A rise in HIV-incidence has occurred in MSM in the UK despite an only modest increase in levels of condomless sex and high coverage of ART. ART has almost certainly exerted a limiting effect on incidence. Much higher rates of HIV testing combined with initiation of ART at diagnosis would be likely to lead to substantial reductions in HIV incidence. Increased condom use should be promoted to avoid the erosion of the benefits of ART and to prevent other serious sexually transmitted infections.