We enrolled 264 patients with papillary thyroid carcinoma (PTC). We performed immunohistochemical detection of p16 and determined the degree of interstitial fibrosis (IF). The expression of p16 was associated with pathological tumor–node–metastasis (pTNM) stage and age (p < 0.05). The cancer-specific survival (CSS) was longer in p16-negative patients (195.73 vs. 181.78 months, p = 0.007). p16 was significantly related to the degree of IF (r = 0.130, p = 0.035). PTC patients with no or mild fibrosis tended to have a larger tumor (p = 0.045). The degree of fibrosis was related to the proportion of papillary structure components (p = 0.025). Univariate and multivariate survival analyses showed that relapse-free survival (RFS) was longer in patients with moderate/severe IF (p < 0.05). In summary, p16 was correlated with prognosis and IF of PTC. Patients with moderate/severe IF tend to have better prognosis in RFS.