OBJECTIVE: To assess the cost-effectiveness of bone marrow transplant (BMT) compared with conventional chemotherapy on leukemia, malignant lymphoma, multiple myeloma, and children solid tumors in Japan. METHODS: We reviewed direct medical costs in 3 years for BMT undertaken in domestic clinical trials with 40 patients (26 adults and 14 children). Additional data for costs, including probabilities, were employed from published literature in Japan. A decision analytic model with decision trees was used to estimate the average direct medical cost in three years. Regarding therapeutic effectiveness, we used the Declining Exponential Approximation of Life Expectancy (DEALE) method to estimate the expected life years of survival. The cost estimation included the direct medical cost and the mortality cost. Sensitivity analyses were performed to test the results. RESULTS: As a result of review, the average costs in 3 months associated with the domestic clinical trials were estimated to be JPY\ 6,072,866 for adults and JPY\ 5,276,643 for children with respect to BMT. Consequently, the total costs in three years with the decision analytic model were estimated as JPY\ 26,760,804 per patient for BMT and JPY\ 23,296,564 per patient for chemotherapy. The life expectancies were 6.28 years per patient for BMT, whereas 4.25 years per patient for chemotherapy. The cost-effectiveness ratios (cost per life year gained) were JPY\ 4,261,274 for BMT in contrast with JPY\ 5,355,532 for chemotherapy. Since the incremental cost was JPY\ 3,464,240 comparing BMT with chemotherapy, the incremental cost-effectiveness ratio was eventually estimated to be JPY\ 1,794,943. CONCLUSION: The cost-effectiveness analysis was conducted based on the cost data in Japan. It is concluded that BMT was more cost-effective than conventional chemotherapy.