Clinical trials have shown prophylactic human papillomavirus (HPV) vaccines to be effective against infection and disease. We examined whether HPV vaccination has the potential to be cost-effective. A cohort model of the natural history of HPV was developed, which fits simultaneously Canadian age and type-specific data for infection, cervical intraepithelial neoplasia, cervical cancer (CC) and genital warts (GW). Quality-Adjusted Life-Years (QALYs) lost and costs were estimated using data from the literature. Vaccinating 12-year-old girls (efficacy=95%, no waning, cost/course=CAN$ 400) against HPV-16/18 and HPV-6/11/16/18 is estimated to cost the health provider CAN$ 31,000 (80%CrI: 15,000-55,000) and CAN$ 21,000 (80%CrI: 11,000-33,000) per QALY-gained, respectively. Results were most sensitive to age at vaccination, duration of vaccine protection, vaccine cost and QALY-lost due to GW, and were least sensitive to the medical costs. Vaccinating adolescent girls against HPV is likely to be cost-effective. The main benefit of vaccination will be in reducing CC mortality. However, unless screening is modified, the treatment costs saved through vaccination will be insignificant compared to the cost of HPV immunization.