OBJECTIVES: QuantiFERON-TB Gold assay (QFT-G) is a recently approved blood test for detection of tuberculosis (TB) infection. The advantages of tuberculin skin test (TST) are; improved specificity, unaffected by prior BCG vaccination, and single patient visit. The aim of this study was to examine the cost effectiveness of using QFT-G as a screening test followed by the standard treatment of TB infected patients after exposure in close contacts in Japan. METHODS: We used a Markov model to compare the cost and effectiveness of QFT-G alone, TST alone, and TST followed by QFT-G using a hypothetical adult cohort (20 years old) of close contact patients with sputum-smear-positive TB patients. Main outcome measure was incremental cost per Quality adjusted life year (QALY) gained during lifetime. In the model, costs and effectiveness of each screening test, further chest X-ray examination, prophylaxis after identifying as infected patients, and treatment for overt tuberculosis patients who is not identified by screening or suffer from the disease even after prophylaxis were considered and estimated with published literatures. Both deterministic one-way and probabilistic sensitivity analysis were performed. RESULTS: TST alone was the most expensive and the least effective alternative. The mean QALYs for QFT-G only strategy was slightly higher than that for TST followed by QFT-G strategy (27.0565 vs. 27.0564). Total costs from the societal perspective were higher on average for the TST followed by QFT-G strategy ($ 120.9) than the QFT-G alone strategy ($ 112.9). The incremental cost effectiveness ratio for QFT-G alone strategy dominated. The results were robust in deterministic one-way sensitivity analysis while the acceptability curve showed that the QFT-G alone strategy has 99.6 % chance of being cost effective at $ 50,000/QALY gained threshold. CONCLUSION: QFT-G alone strategy is the least expensive and the most effective in screening the TB infection after exposure in close contacts in Japan.