OBJECTIVES: Asthma is an increasing problem and questions regarding the relationship to residential location have been raised in many countries. Thus, inpatient and emergency department (ED) care for pediatric (age below 18 years) asthmatics and related costs were examined by residential location for one year. METHODS: Using 2001-02 Massachusetts data, patients treated for asthma (ICD-9 principal diagnosis code: 493.00-493.92) were identified. An encounter profile was established for each patient starting with the first asthma-related stay/visit (index encounter) at any hospital or ED in 2001, and included all subsequent inpatient and ED care for asthma within twelve months. Using zip codes, patients were classified by residential location (urban, suburban, rural). Massachusetts has 351 cities and towns; 10% urban, 19% rural, and 71% suburban. Hospital charges, adjusted by a 0.517 cost-to-charge ratio, medical inflation and geographic factors are reported in 2007 US$. RESULTS: The cohort (n=10,035) had 13,576 asthma-related encounters (77% ED visits) during the year. The proportion of ED visits did not differ significantly (p>0.05) by residential location. Rural patients (2%) had 1-6 encounters, mean 1.2, mean care days: 5.8, mean cost: $6,702 per patient; suburban patients (30%) had 1-7 encounters, mean 1.2,mean care days: 3.9, mean cost: $2,984; and the 68% urban patients had 1-14 encounters, mean 1.4, mean care days: 3.8, mean cost: $4,658. Significantly (p<0.05) more urban patients were <10 years old (66%) compared with rural (54%) and suburban (51%). Urban patients used 7,757 hospital days and 17,764 ED hours in one year, accruing $11.3 million. Suburban patients accrued 3,197 inpatient days, 6,685 ED hours and $399,994. Rural patients accrued 230 hospital days, 238 ED hours and $297,744. CONCLUSION: Although most of the patients were from urban locations, patients from rural areas, though less numerous, incurred more days of care at a higher cost per patient