OBJECTIVES: Asthma bronchiale (AB) and chronic bronchitis (CB) are common chronic disorders with high rates of prevalence. We performed a cost of illness study that aimed to assess the economic burden of these disorders in Germany. To the best of our knowledge, we used the first time data for entire Germany, in contrast with the few previous studies. METHODS: We obtained in a retrospective analysis secondary data from governmental institutions as well as from pharmaceutical industry. Resource use was based on 1996 schedules and costs were estimated in 1996 DM. We chose the cost perspective of sickness funds to estimate direct costs. The human capital approach was applied for the calculation of indirect costs. RESULTS: Total estimated costs were DM 5.81 billion related to AB, and DM 20.17 billion related to CB. We did not include outpatient physician services in the calculation of direct costs in lack of adequate data. Therefore, direct costs represented only 33 % and 22 % of total estimated costs, respectively. The most important cost driver of direct costs were outpatient prescribed medicines, followed by hospitalization. Outpatient prescribed medicines accounted for 55 % and 63 % of the direct costs, respectively. Of the indirect costs of AB 43 % were associated with early retirement. Loss of work was with 75 % by far the largest single cost driver of indirect costs due to CB. CONCLUSIONS: Findings from this study for Germany show the evident importance of outpatient prescribed medicines as cost driver of direct costs of AB as well as of CB. Furthermore, this study underlines the major role of loss of work concerning indirect costs of CB. The data suggest that therapeutic progress and cessation of smoking can provide distinctive savings of direct costs and even more of indirect costs of AB and CB.