Low-molar-mass, OH-telechelic polybutadienes were hydrogenated (1) by diimide alone and (2) by using a novel method, consisting of the following two steps: up to some 95% degree of conversion by gaseous hydrogen with conventional Ziegler-Natta catalysts, and, only then, up to almost full saturation by diimide. The two-step method, which has been found to be equally efficient, enables one to decrease substantially the necessary feed of p-toluenesulfonylhydrazide, by the thermal decomposition of which diimide is generated. The crude saturated products, which could not be purified by a conventional (re)precipitation technique due to their low molar mass, contained a relatively large amount of a side-product, bis(p-tolyl)disulfide (TDS). It was found that free TDS can be converted quantitatively by reduction cleavage into p-tolyl mercaptan (TM) without changing the structure of the polymeric product, and TM can then be removed from the mixture by alkaline extraction. Alternatively, the crude product can be freed from TDS by chromatography. With the two-step hydrogenation method, only a small amount of the fragments and/or precursors of TDS add to the 5% residual C=C double bonds of the partially hydrogenated polybutadiene chains. After any of the two purification procedures, the fully saturated products usually contained less than 1 wt % of such undesirable substituents only, which is comparable with the reported single; step diimide hydrogenation of the initial, fully unsaturated polybutadiene in the presence of a proton scavenger (tri-n-propylamine).