OBJECTIVES: In the 1980s, China launched market-oriented reforms. Public hospitals were encouraged to make their own incomes with the aim of mobilizing medical workers and improving hospital efficiency. Less government funding resulted in deficits for public health institutions, which forced hospitals to generate their own revenue by aggressively selling drugs, especially antibiotics. This study was designed to evaluate the impact of inappropriate antibiotic use on inpatients’ cost during the hospitalization. METHODS: 1000 cases with antibiotic treatment from 10 hospitals of 5 provinces in China in 2006. We created multivariate linear regression model for hospital cost and logistic regression model for rationality evaluation of antibiotic use. RESULTS: Finally we collected 964 valid cases. Rate of inappropriate antibiotic use was 58.4%. Costs of inpatients with inappropriate antibiotic use was as 2.75 times as the ones with appropriate use (P<0.001). Risk factors included antibiotic prophylaxis (OR=2.929), operations (OR=2.44), long hospital stay (OR=1.021 for every prolonged day) and regional factors. Protection factor was in tertiary hospital (OR=0.510). CONCLUSIONS: This study concluded that inappropriate antibiotic use contributes to inpatients’ high cost. Efforts to control misuse of antibiotic should be pursued.