OBJECTIVES: To estimate the cost-effectiveness of sunitinib malate versus palliative/best supportive care (BSC) in the treatment of cytokine-refractory metastatic renal cell carcinoma (mRCC) in patients failing on IL-2, interferon-alpha or combination of these. METHODS: A Markov model was developed and adapted to Argentinean circumstances. Effectiveness results were taken from a clinical trial and a US Medicare database. Data was adjusted with general population mortality estimates from Argentinean life tables. Utilities were collected with the help of EQ-5D questionnaire in the clinical trial. The main source of resource use and unit costs was an Oncology Institute in Argentina. Costs were calculated in 2006 Argentinean pesos (AR$). Both costs and effectiveness were discounted at a 3% annual rate. Incremental cost-effectiveness was calculated for progression-free month (PFM), life-year saved (LYS) and quality adjusted life years (QALY). Both deterministic and probabilistic sensitivity analyses were undertaken for effectiveness and cost variables. RESULTS: Compared to BSC, sunitinib resulted in 2.61 extra PFM, 1.32 LYS and 0.98 QALY; however, at an additional cost of AR$52,243. The cost of gaining one PFM, LYS and QALY was AR$9,596, AR$39,518 and AR$53,445 respectively. The result was most sensitive to effectiveness parameters. The incremental cost/QALY was always under the US threshold of $50,000. CONCLUSION: Though treatment with sunitinib is more costly than BSC, it is more effective. Using the US $50,000/QALY incremental cost-effectiveness threshold, sunitinib seems to be cost-effective in the second-line treatment of mRCC in Argentina.