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In China, a cultivation system that uses low plant densities and the retention of vegetative branches is currently referred to as the cost-saving cotton production system, which contrasts with the conventional system that uses moderate plant densities and the removal of vegetative branches. Two experiments were conducted each year in Linqing, Shandong (Yellow River Valley) China, to study the effects of plant density, number of vegetative branches, cultivars, and their interactions on yield, yield components, and production costs in 2002 and 2003. In the first experiment of both years using a hybrid Bt (Bacillus thuringiensis Berliner) cotton SCRC15, seed cotton yield and lint percentage averaged across the number of vegetative branches were not significantly different among three plant densities. The interaction between plant density and the number of vegetative branches on lint yield was significant in both years, although no crossover response occurred. Compared with the conventional system (5.25 plants m-2 with 0 vegetative branches), the cost-saving system (2.25 plants m-2 with 4 vegetative branches) had a 11.4% and 8.5% increase in lint yield in 2002 and 2003, respectively. The cost-saving system had $110 ha-1 decrease in production costs through a reduction in seeding rate and labor costs. Lint yield averaged across population density with 2 vegetative branches and 4 vegetative branches per plant was increased by 6.4 % and 14.3 % in 2002, and 4.9% and 6.9% in 2003, respectively, compared with plants with all vegetative branches removed. In the second experiment in both years, three hybrid Bt cottons managed with the cost- saving system produced significantly higher yields than with the conventional system, but significant yield reduction was observed in two non-hybrid cottons produced with cost-saving system compared with the conventional system in 2002. These results indicate that hybrid Bt cottons were more adapted to the cost-saving production system than non-hybrid Bt cottons. For Bt hybrid cotton the cost-saving production system that uses a combination of hill-drop planting, plastic mulching, low plant density, and the retention of vegetative branches has the potential to reduce production costs without sacrificing yield. [ABSTRACT FROM AUTHOR]