CONTEXT: Pneumococcal conjugate vaccine for infants has recently been found effective against meningitis, bacteremia, pneumonia, and otitis media. OBJECTIVE: To evaluate the projected health and economic impact of pneumococcal conjugate vaccination of healthy US infants and young children. DESIGN: Cost-effectiveness analysis based on data from the Northern California Kaiser Permanente randomized trial and other published and unpublished sources. SETTING AND PATIENTS: A hypothetical US birth cohort of 3.8 million infants. INTERVENTIONS: Hypothetical comparisons of routine vaccination of healthy infants, requiring 4 doses of pneumococcal conjugate vaccine (at 2, 4, 6, and 12-15 months), and catch-up vaccination of children aged 2 to 4.9 years requiring 1 dose, with children receiving no intervention. MAIN OUTCOME MEASURES: Cost per life-year saved and cost per episode of meningitis, bacteremia, pneumonia, and otitis media prevented. RESULTS: Vaccination of healthy infants would prevent more than 12000 cases of meningitis and bacteremia, 53000 cases of pneumonia, 1 million episodes of otitis media, and 116 deaths due to pneumococcal infection. Before accounting for vaccine costs, the vaccination program would save $342 million in medical and $415 million in work-loss and other costs from averted pneumococcal disease. Vaccination of healthy infants would result in net savings for society if the vaccine cost less than $46 per dose, and net savings for the health care payer if the vaccine cost less than $18 per dose. At the manufacturer’s list price of $58 per dose, infant vaccination would cost society $80000 per life-year saved or $160 per otitis media episode prevented (other estimated costs would be $3200 per pneumonia case prevented, $15000 for bacteremia, and $280000 for meningitis). The cost-effectiveness of an additional program to administer 1 dose of vaccine to children aged 2 to 4.9 years would vary depending on the children’s ages, relative risks of pneumococcal disease, and vaccine cost. CONCLUSIONS: Pneumococcal conjugate vaccination of healthy US infants has the potential to be cost-effective. To achieve cost savings, its cost would need to be lower than the manufacturer’s list price. In addition to tangible costs, the vaccine should be appraised based on the less tangible value of preventing mortality and morbidity from pneumococcal disease.