OBJECTIVES: Chronic obstructive pulmonary disease (COPD) is one of the most common chronic and disabling diseases worldwide. The objectives of this study were to measure the societal costs of COPD including both direct and indirect costs, and to estimate the costs for different severity grades of disease according to changed Swedish guidelines. METHODS: A well-defined and representative cohort of subjects was used to examine the costs of COPD. Regular telephone interviews were done with 212 subjects derived from the OLIN-Studies in northern Sweden. The severity grades of COPD were divided according to changed Swedish guidelines, and furthermore Mild COPD (FEV1 50-79% of predicted) was divided into three sub-groups, Mild I, II and III. RESULTS: A positive relationship was found between costs and severity grades of COPD, patients with lower FEV1 % of predicted normal being significantly more expensive. Furthermore, the total costs differed significantly between the Mild and Pre-clinical severity groups, from a mean value of SEK 2,513 per subject in the Pre-clinical group to SEK 28,463 for subjects having FEV1 50-59% of predicted. The same pattern was found both in direct and indirect costs. Costs for medicines and hospitalisations increased significantly according to FEV1 values in the Mild and Pre-clinical groups of disease. Costs for disability pension among indirect costs showed a similar trend. The annual total costs for Severe (FEV1 <30% of predicted), Moderate (30-49%), Mild I (50-59%), Mild II (60-69%), Mild III (70-79%), and Pre-clinical COPD (>79%) were SEK 183,474, 70,609, 28,463, 11,527, 6,287 and 2,513, respectively. CONCLUSION: Large variations were found in both the level and breakdown of costs for COPD, mainly depending on the severity of the disease. When dividing mild COPD into three different severity grades of disease, we also found a positive relationship between costs and severity of disease.