The purpose of the study was to estimate the cost-effectiveness of gastric bypass in the treatment of severe obesity (body mass index > 40). A deterministic decision analysis that compared the lifetime expected costs and outcomes between open gastric bypass and no treatment of severe obesity from the payer perspective was performed. Men and women between the ages of 35 and 55 yr, with body mass index between 40 and 50 kg/m 2, who did not have cardiac disease and who failed conservative treatment, including pharmacotherapy, were included. Cost-effectiveness ratio of the base case conditions was made with parameter estimates from the literature and expert discussion and expressed as cost per quality-adjusted life-years (QALY). One- and two-way sensitivity analyses were performed on selected variables. Gastric bypass was not cost-saving, because the reduction in lifetime medical costs was less than the cost of treatment in any subgroup. The base case cost-effectiveness ratios ranged from $5,400 to $16,100 for women and from $10,700 to $35,600 per QALY for men. Sensitivity analysis demonstrated that in older, less obese men, the cost effectiveness ratio was responsive to the amount of weight lost, obesity-related quality of life, and complication rates. Parameter variation did not significantly affect cost-effectiveness ratios in the remaining patients. The authors concluded that gastric bypass is a cost-effective alternative to no treatment in the severely obese, at less than $50,000 per QALY.