Purpose: There is a need for better biomarkers to both detect bladder cancer and distinguish muscle-invasive (stage T2+) from non-invasive (stage Ta/T1) disease. We assess whether MALDI-TOF-MS of the urine peptidome can achieve this. Experimental design: We analysed urine from 751 patients with bladder cancer and 127 patients without bladder cancer. Endogenous peptide profiling was performed using a Bruker Ultraflextreme MALDI-TOF-MS. Results: Significant differences were seen between the spectra of urine from patients with and without T2+ disease. Albumin, total protein and haematuria were also elevated in T2+ patients. Haematuria was detected in 39% of patients with Ta/T1 disease and in 77% of patients with T2+ disease. Class prediction models based on MALDI data produced areas under receiver-operator characteristic curves of up to 0.76 but did not significantly outperform a model based on total protein alone. Many peptides significantly associated with invasive disease are fragments of abundant blood proteins and are also associated with haematuria. Conclusions and clinical relevance: Microscopic haematuria is strongly associated with invasive disease; even traces of blood/plasma strongly influence the urinary peptidome. This needs to be taken into consideration when using 'omic' methods to search for urinary biomarkers as blood proteins may give false-positive results.