The potential for chemoprevention of breast cancer depends on the benefits being achieved at reasonable cost. This study assesses the economics of chemoprevention of breast cancer with tamoxifen within the context of the International Breast Cancer Intervention Study (IBIS) and published data on outcomes. Anonymised trial data are used to measure direct resource costs based on the pattern of service delivery in the IBIS clinics. Changes in morbidity are measured as the differences in use of resources for hospital visits, procedures undertaken in hospital, use of prescribed medications and visits to GPs between women in the 2 arms of IBIS. Changes in quality of life are assessed using the SF 36. Information on the personal costs to the women themselves was gained through a postal questionnaire. A sensitivity analysis assesses the effects on cost effectiveness of alternative assumptions about the duration of the protective effect of tamoxifen (5,10 or 15 years) beyond the treatment period. Other alternative assumptions explored include different models of service delivery, differences in personal costs to the women themselves and in their risk status. Tamoxifen chemoprophylaxis for breast cancer has a cost of less than £5000 per discounted life year gained for women at high risk for the disease assuming that the protective effect persists for at least 10 years. This result is sensitive to the risk status of the women since the number needed to treat (NNT) would be high for women at low absolute risk of breast cancer. The model of service delivery is also important. No significant differences in morbidity between the groups were found. Hospital visits for benign breast disease or gynaecological symptoms and the use of beta blockers may merit further investigation. There appear to be no effects on quality of life. Chemoprevention of breast cancer could be delivered through general practice with minimal specialist support. The potential may be limited because of the need to target women at high risk in order to make efficient use of resources for this common condition.