OBJECTIVES: To compare the psychiatric-related health care resource utilization and direct medical costs of schizophrenia patients initiating typical or atypical antipsychotics in Tianjin, China.  METHODS: Data were obtained from the Tianjin Urban Employee Basic Medical Insurance database (2008-2010). Adult schizophrenia patients with ≥1 prescription of antipsychotics after a ≥90-day washout period (during which patients didn’t receive any antipsychotics) and 12-month continuous enrollment after first prescriptions were included. Psychiatric-related resource utilization and direct medical costs during 12-month follow-up period were estimated. Chi-square test (for categorical) and two-sample t-test (for continuous) were conducted to detect differences between typical and atypical initiators. Logistic regressions controlling for demographics, mental health comorbidities, concomitant medications, prior resource utilization and prior medical costs were applied to compare resource utilization, and ordinary least square (OLS) linear regression to estimate cost differences. One-to-one propensity score matching was conducted as a sensitivity analysis. RESULTS: A total of 1131 patients initiated with either typical (N=483) or atypical antipsychotics (N=648). Over the 12-month follow-up, compared with the typical initiators, the atypical initiators had a significantly lower rate of hospitalization (45.8% vs. 56.7%, p<0.001), consistent with logistic regression result (OR=0.58, p<0.001). Mean (SD) annual antipsychotic costs for the atypical initiators were higher than the typical initiators [$288 (431) vs. $63 (216), P<0.001]. However, mean annual inpatient non-medication costs were significantly lower [atypical vs. typical $1213 (2061) vs. $1699 (2346), P<0.001]. The total annual costs were not significantly different between atypical and typical initiators [$1661 (2224) vs. $1892 (2465), p=0.100], consistent with the results from OLS (atypical-typical=-$229, p=0.091) and propensity score matching [$1711 (2240) vs. 1868 (2450), p=0.341]. CONCLUSIONS: Although antipsychotic costs were higher for patients initiated on atypical antipsychotics, atypical initiators had similar total annual direct medical costs compared to typical initiators, mainly due to a lower rate of atypical initiators being hospitalized.