We calculated the incremental cost per quit of a telephone care intervention versus usual care using the provider's perspective. The study population was 819 smokers at five US Veterans Affairs (VA) primary care clinics. They enrolled in the clinical trial between June 2001 and December 2002. After 12 months the participants were assessed for short- and long-term abstinence over the previous six months. VA records were used to extract the cost of VA services over 12 months, and the cost of care purchased by the VA from others. Intervention costs were derived through micro-costing. On average, the intervention cost $142 per person, excluding medications. The average cost of all VA-funded medical care during the study period was $8959 in the telephone-care arm and $7939 in the usual care arm (P = 0.37). Under a standard intent-to-treat analysis the average cost per quit was $11,408 and thus the intervention was cost-effective by conventional standards.