OBJECTIVE: The purpose of this study was to determine the burden of illness of influenza in the United States. METHODS: Retrospective analysis was conducted of the 1999 portion of the Medical Expenditure Panel Survey. Data was collected from a nationally representative sample of 24,618 respondents and linked to data from respondents' medical care and health insurance providers and employers. Data used in this study included medical conditions, use and payments for medical care, and employment information comprised of hourly earnings, hours worked, and disability days. Influenza patients were identified using ICD-9-CM codes (487.0-487.8). Direct costs were calculated using patient and third-party payments for influenza-related medical events. Indirect costs were calculated for influenza patients who incurred missed workdays using the human capital approach. Sample estimates were weighted and projected to the population and 95 percent confidence limits were calculated using the Taylor expansion method. RESULTS: Approximately 6.38% (95% C.L. = 5.86%-6.91%) or 17,640,761 individuals experienced influenza and 2.50% (95% C.L. = 2.22%-2.79%) or 6,920,976 individuals experienced influenza resulting in missed workdays. Total costs of influenza were $10,413,397,186. Direct costs were $1,251,588,028. Office-based medical provider visits represented the highest proportion of direct costs, at $407,049,515 (mean = $64.56; 95% C.L. = $54.45-$74.67). Home health care expenditures were $265 million. Expenditures for inpatient stays, prescription medications, and emergency department visits were similar, at $189 million, $185 million, and $175 million, respectively. Outpatient services represented the lowest proportion of direct costs, at $31 million. Indirect costs of influenza were $9,161,809,158 with mean indirect costs of $1,325 per patient (95% C.L. = $1,130-$1,521). CONCLUSIONS: Affecting more than 17 million individuals in the population with a total cost of $10.4 billion, the burden of illness of influenza was substantial. With indirect costs accounting for nearly 90% of total costs, influenza significantly impacts the labor force underscoring the importance of prevention to minimize absenteeism and maintain productivity.