OBJECTIVES: The benefit of screening for and definitive treatment for prostate cancer has been questioned.  Results from the Scandinavian study of radical prostatectomy compared to watchful waiting for non-screen detected prostate cancer demonstrated decrease in prostate cancer specific mortality, palliative treatment and overall survival.  We evaluated the cost effectiveness of radical prostatectomy compared to watchful waiting using data from the Scandinavian study protocol when extrapolated to the US. METHODS: We used the previously reported cost of care data for patients with prostate cancer based on the patterns of care observed in the CaPSURE database.  The data from the Scandinavian trial, in accordance with the study protocol, was used to determine the costs and cost-effectiveness of radical prostatectomy for treatment of prostate cancer.  The cost-effectiveness for radical prostatectomy was determined and was adjusted for the costs of androgen deprivation therapy as used in each study arm.  A model incorporating age at diagnosis, life expectancy and estimate of benefits from radical prostatectomy was created that predicts cost effectiveness of surgical intervention for prostate cancer.  A sensitivity analysis was performed to test the robustness of results. RESULTS: Compared to watchful waiting, radical prostatectomy is associated with savings of $92,259 per life saved or $4,128 per LYS.  When the rate of treatment with ADT in each study arm is taken into account, radical prostatectomy for treatment of non-screen detected prostate cancer is associated with cost savings of $475,297 per life saved or savings of $27,959 per life-year saved compared to the costs of watchful waiting.  CONCLUSIONS: Radical prostatectomy is a cost effective treatment for non-screen detected prostate cancer.  Treatment with radical prostatectomy is associated with significant cost savings, improved survival, decreased rate of metastatic disease and lower rate of palliative care compared to watchful waiting.  For patients who are surgical candidates watchful waiting is associated with higher morbidity, mortality and costs.