OBJECTIVES: Kidney disease is a common condition in which kidneys fail to function properly. In this study, the highest incidence and prevalence rates of end-stage renal disease [ESRD] (i.e.,both renal transplant and dialysis) were reported from the USA, Taiwan, and Japan. In the Arab countries of the Middle East, Saudi Arabia recorded the highest prevalence of patients with renal failure of 600 cases per million of population, while Kuwait recorded the lowest prevalence rate of 80 cases per million. In the West Bank, the total number of renal failure patients was 692 in the first quarter of 2012—an increase of 11.3% over the same period in 2011. METHODS: Prospective estimates and elicited expert opinions are used to estimate the unit costs of hemodialysis and / or kidney transplantation in the Palestine. Our study retrospectively reviewed epidemiological data on hemodialysis including: 1. Number of patients receiving hemodialysis; 2. Incidence rate; 3. Total mortality. The direct cost of kidney transplantation was estimated by dividing the procedures into three phases: (1) pre-transplant, (2) transplant, and (3) post-transplant. Cost analysis for hemodialysis was performed for each patient on dialysis.  RESULTS: The average cost for kidney transplant was US$16,277 for the first year; the estimated cost of a single hemodialysis session was US$97; while the cost of hemodialysis per patient was variable, it averaged $16,085 per year—nearly as much as a transplant. CONCLUSIONS: While live, related kidney donors are scarce, our study revealed that kidney transplant was more adequate and less expensive than hemodialysis. These results were similar to many related studies, and have direct resource allocation implications for government-funded kidney disease services funded by through Palestinian Ministry of Health.