OBJECTIVES: This study aims to investigate the direct medical costs for inpatient services of chronic renal failure in Guangzhou, China and to explore its determinants. METHODS: Direct inpatient services costs data were drawn from the reimbursement claim database in Guangzhou City, which covers the entire Urban Employee Basic Medical Insurance and Urban Resident Basic Medical Insurance enrollees of Guangzhou City. The records of patients who were admitted to hospitals between January 2010 and December 2012 with a diagnosis of chronic renal failure were all included. Descriptive and regression analyses (through the extended estimating equations approach) were conducted to study the determinants of direct hospital costs. RESULTS: A total of 3,524 hospitalisation records were identified. The mean (standard deviation, SD) age of patients was 60 (18) years old and the majority were male (54%). Patients were more likely to receive inpatient treatments at tertiary hospitals (83%), followed by secondary (16%) and primary hospitals (1%). The mean (SD) of direct hospital costs per visit was 16,440 (22,677) RMB, among which the medication costs account for 38% whereas the out-of-pocket expenses (OOP) account for 25% of total direct hospital costs. The mean (SD) length of stay was 15 (12) days. Key regression analysis results suggest that age, the type of basic medical insurance schemes, hospital levels, length of stay, and whether the patient had received kidney transplant were all significantly associated with the total direct inpatient services costs (all P<0.05). Gender was insignificantly associated with the total costs (P>0.10). CONCLUSIONS: Both demand and supply side factors were significantly associated with the direct inpatient services costs of chronic renal failure. The establishment of urban basic medical insurance schemes has reduced the financial burden for the insured urban population.