OBJECTIVES: Muscle-invasive bladder cancer (MIBC) is a deadly disease that disproportionately affects the elderly and is treated with bladder removal (i.e. radical cystectomy).  A novel therapy utilizing chemo-radiation has demonstrated fewer adverse effects with comparable survival rates, with the possibility of requiring delayed cystectomy. The objective of this study was to examine the cost-utility of radical cystectomy compared to chemo-radiation in the treatment of (MIBC) among the elderly. METHODS: A decision-analytic model from the Medicare payer perspective followed hypothetical patients ages 65 and older with MIBC, using a 5-year time horizon from the start of treatment. Surgery and chemo-radiation toxicity, survival, and quality-of-life weights were derived from the clinical literature, and costs were derived from 2013 Medicare fee schedules. Sensitivity analyses were performed to address the uncertainty of parameter values. RESULTS: In the base-case analysis, chemo-radiation was less costly and less effective than radical cystectomy. Chemo-radiation resulted in a cost savings of $6,788 per patient whereas cystectomy resulted in additional 1.2 quality-adjusted life-years (QALY) per patient. Thus, cystectomy would be preferred with an incremental cost-effectiveness ratio of $5,680 per QALY.  Therefore, at a threshold of $50,000 per QALY, chemo-radiation is not cost-effective when compared to radical cystectomy. Overall conclusions remained the same in sensitivity analyses, although the model was most dependent on the mortality rate at 5 years following treatment as well as recurrence rates following chemo-radiation. CONCLUSIONS: Cost-utility analysis comparing chemo-radiation to cystectomy as primary treatment for MIBC reveals that chemo-radiation is not cost-effective when compared to cystectomy.