OBJECTIVE: Recent guidelines have recommended that children aged 6-24 months should be immunized with influenza vaccine to protect against influenza. Our objective was to evaluate health outcomes and costs to society of influenza vaccination on influenza and acute otitis media infection in an otherwise healthy population of 6 24- month old infants. METHODS: Based on published and unpublished data, a decision analytical model comparing two strategies: children vaccinated with inactivated influenza vaccine and children not vaccinated children has been developed. The clinical pathway predicted the probability of becoming infected with influenza, developing acute otitis media in conjunction with influenza or alone. Health outcomes used in this model included days of illness as well as days of paid employment missed by primary caregiver. Costs incorporated into the model included both direct and indirect costs including cost of vaccination, pharmaceutical costs of treatment of infection, hospitalization, and caregiver employment income lost. Robustness of results was tested by univariate and multivariate sensitivity analysis. The model was used to simulate the results for an otherwise health population comparing vaccination to non-vaccination strategy of care. RESULTS: Vaccination programs had lower cost and better health outcomes when compared to non-vaccination programs. Vaccinated children had an expected cost to society of $329.51 with 2.29 expected days of illness and 1.93 days of work missed by the primary caregiver. Non-vaccinated children had an expected cost of $393.78 with 3.97 expected days of illness and 2.63 days of work missed by the primary caregiver. Univariate and multivariate sensitivity analysis showed these results to be robust in upholding vaccination as a cost effective alternative to no vaccination over a wide range of assumptions. CONCLUSION: Immunization with inactivated influenza vaccine is a cost effective treatment in reducing the incidence of both influenza and acute otitis media for children aged 6-24 months.