OBJECTIVES: Deep brain stimulation (DBS), which uses an implantable device to modulate brain activity, has been shown to be clinically superior to medical therapy for treating advanced Parkinson’s disease. Our objective was to study the cost-utility of DBS in conjunction with medical therapy compared to best medical therapy (BMT) alone, using the latest clinical and cost data for the U.S. healthcare system. METHODS: We used a decision-analytic state-transition (Markov) model to project Parkinson’s disease progression and associated costs for the two treatment strategies. We estimated the discounted incremental cost-effectiveness ratio (ICER) in U.S. dollars per quality-adjusted life-year (QALY) from the Medicare payer perspective, considering a 10-year horizon. We evaluated the robustness of our projections through extensive deterministic sensitivity analyses. RESULTS: Over 10 years, DBS treatment led to discounted total costs of $129,345 compared to $91,026 for BMT and added 1.69 QALYs more than BMT, resulting in an ICER of $22,713 per QALY. This ICER was relatively insensitive to variations in input parameters, with neurostimulator replacement timepoint, costs related to DBS implantation, and costs related to the treatment of disease-related falls having the greatest effects on the ratio. Across all investigated scenarios, including a 5-year horizon, ICERs remained under $50,000 per QALY. Longer follow-up periods and younger treatment age were associated with greater cost-effectiveness. CONCLUSIONS: Our findings suggest that DBS is a cost-effective treatment strategy in the U.S. healthcare system across a wide range of assumptions. DBS yields substantial improvements in health-related quality of life at a value profile that compares favorably to other well-accepted therapies.