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In the Netherlands vaccination against hepatitis B has up to now targeted risk groups such as homosexual men, prostitutes, injecting drug users and persons working in the medical professions. At present, there is a discussion going on about whether to introduce hepatitis B vaccination into the national immunisation programme, as advised by the WHO in 1992. The RIVM has been asked to support decision makers by providing a cost-effectiveness analysis of such a programme, based on current knowledge of the epidemiology of hepatitis B infection and the consequent health-care costs. We collected information on hepatitis B epidemiology from various sources, ranging from notification data to preliminary results of an ongoing case-control study on hepatitis B transmission. After consulting on the prevalence of HBV carriers in the various risk groups and the impact of demographic factors, such as immigration of carriers from highly endemic regions, we simulated hepatitis B infection in an age-structured population with a dynamic transmission model. We also investigated the effects of universal vaccination using this model. The incidences computed by the model were then used as a basis for a cost-effectiveness analysis that resulted in estimates for the costs per life year gained. One of the major conclusions was that circulation of the virus is kept up only within small risk groups; therefore the prevalence of HBV carriage in the Netherlands is mainly determined by immigration of carriers. As a consequence, the effects of national vaccination on the prevalence of HBV will be marginal and the cost per life year gained high. However, our estimates on the cost per life year gained depend heavily on future costs of vaccination and on discounting of future effects. When future effects are not discounted, a national vaccination campaign will be more cost-effective.