OBJECTIVES: Several methods have been to estimate costs in economic evaluation studies. Different methods may give different values. The magnitudes of difference of estimates based on cost-to-charge ratio and diagnosis related group (DRG) methods were not much investigated. This study aimed to assess the differences of estimates of direct medical cost calculated by cost-to-charge ratio and DRG method using Stevens - Johnson syndrome (SJS) and Toxic epidermal necrolysis (TEN) as a case study. METHODS: This study was undertaken with retrospective cohort approach using electronic databases of a hospital located in the northern part of Thailand. We included patients who came to the hospital between January 1, 2003 and December 31, 2007 and were coded with International Classification of Disease 10th Edition (ICD-10) of L51.1 (SJS) or L51.2 (TEN). We used cost-to-charge ratio and DRG methods to estimate direct medical cost of SJS/TEN. All cost estimates were converted to reference year (2008) using Thai consumer price index in health product sectors. RESULTS: One hundred and fifty-four patients were included. Mean age was 45.3 years. Fifty-six percent were male and 93% were SJS patients. The mean and median direct medical cost estimated by cost-to-charge ratio was USD918 and USD308, respectively. The mean and median values estimated by DRG were much lower with cost of USD554 and USD264, respectively. The mean estimate based on cost-to-charge ratio was higher than that of DRG by USD364 or 1.65 times. CONCLUSIONS: The cost estimates using cost-to-charge ratio and DRG are different. Selection of cost estimations may impact the cost estimates and cost-effectiveness results. Researchers should consider the perspective of study while choosing the method used for estimating costs.