Objective: This study estimates the hospital costs of treating work-related injury among a cohort of sawmill workers in British Columbia. Methods: Hospital discharge records were extracted from 1989 to 1998 for a cohort of 5876 actively employed sawmill workers. Injury cases were identified as work-related from these records using ICD-9 external cause of injury codes that indicate place of occurrence and the responsibility of payment schedule that identifies workers' compensation as being responsible for payment. The hospitals in British Columbia have a standard ward rate chart prepared annually by the provincial Ministry of Health to bill and collect payment from agency like workers' compensation agency. Costs were calculated from the hospital perspective using this billing chart. All costs were expressed in 1995 Canadian dollars. The workers' compensation claim records for this study population were extracted and matched with the hospitalised work-related injury records. Costs were also calculated for work-related hospitalisations that the hospital did not appear to be reimbursed for by the workers' compensation system. Results: There were 173 injuries requiring hospitalisation during the 10-year follow-up period. The median stay in hospitals was 3 days and the median hospital costs were $847. The most costly cause of injury categories were fire, flame, natural and environmental and struck against with median costs of $10,575 and $1206, respectively, while the least costly category was cutting and piercing with median costs of $296. The most costly nature of injury categories were burns and fracture of lower Limb with median costs of $10,575 and $1800, respectively, while the Least costly category was dislocation, sprains and strains with median costs of $437. The total hospital costs for all the work-related injuries were $434,990. Out of a total hospital cost of $434,990 for the 173 work-related injuries, the provincial compensation agency apparently did not compensate $50,663 (12%). Conclusion: Prevention of work-related injuries can save significant amount of health care resources. Substantial costs remain uncompensated by the provincial compensation agency and are thus transferred to the provincial health care system annually. (c) 2006 Elsevier Ltd. All rights reserved.