Objective: To compare the cost-effectiveness of a newly introduced decentralized method with the existing centralized solid waste management (SWM) method in 2019 in Tirunelveli City, Tamil Nadu, India. Materials and Methods: A cross-sectional study was undertaken to compare the costs for the two SWM methods using the bottom-up approach. We ascertained cost centers for the collection, transportation, and processing of solid waste for the two methods. We reviewed the records and collected data to estimate the costs and outputs (waste processed per capita) of the two SWM methods using data abstraction forms for each identified cost center. We calculated the cost and outcome of both methods and the incremental cost-effectiveness ratio (ICER). Results: The total cost for the decentralized method was ₹121 million (USD 1.72 million), and that of the centralized method was ₹222 million (USD 3.15 million). The cost per capita of SWM in one year was lesser for the decentralized (₹526) as compared to the centralized method (₹612). The cost per metric tonne (MT) of SWM in decentralized and centralized methods was ₹5595 and ₹4683, respectively. The ICER lies in the right lower quadrant (ICER: 1.2375), indicating that the decentralized method was cost-effective. Conclusion: Solid waste processing by the decentralized method is cost-effective as compared to the centralized processing method in terms of waste processed per capita. We recommend the civic bodies to adopt the decentralized method with sufficient allocation of resources for efficient SWM. Furthermore, this will not only reduce greenhouse gas emissions but also have a positive impact on climate change mitigation.