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Introduction: Antiretroviral therapy (ART) monitoring using viral load (VL) testing is challenging in high‐burden, limited‐resources settings. Chemokine IP‐10 (interferon gamma‐induced protein 10) strongly correlates with human immunodeficiency virus (HIV) VL. Its determination could serve to predict virological failure (VF) and to triage patients requiring VL testing. We assessed the field performance of a semi‐quantitative IP‐10 lateral flow assay (LFA) for VF screening in South Africa, and the cost‐effectiveness of its implementation in Mozambique. Methods: A cross‐sectional study was conducted between June and December 2021 in three primary health clinics in the Western Cape. Finger prick capillary blood was collected from adults on ART for ≥1 year for direct application onto the IP‐10 LFA (index test) and compared with a plasma VL result ≤1 month prior (reference test). We estimated the area under the receiver operating characteristic curves (AUC), sensitivity and specificity, to evaluate IP‐10 LFA prediction of VF (VL>1000 copies/ml). A decision tree model was used to investigate the cost‐effectiveness of integrating IP‐10 LFA combined with VL testing into the current Mozambican ART monitoring strategy. Averted disability‐adjusted life years (DALYs) and HIV acquisitions, and incremental cost‐effectiveness ratios were estimated. Results: Among 209 participants (median age 38 years and 84% female), 18% had VF. Median IP‐10 LFA values were higher among individuals with VF compared to those without (24.0 vs. 14.6; p<0.001). The IP‐10 LFA predicted VF with an AUC = 0.76 (95% confidence interval (CI) 0.67–0.85), 91.9% sensitivity (95% CI 78.1–98.3) and 35.1% specificity (95% CI 28.0–42.7). Integrating the IP‐10 LFA in a setting with 20% VF prevalence and 61% VL testing coverage could save 13.0% of costs and avert 14.9% of DALYs and 55.7% new HIV acquisitions. Furthermore, its introduction was estimated to reduce the total number of routine VL tests required for ART monitoring by up to 68%. Conclusions: The IP‐10 LFA is an effective VF triage test for routine ART monitoring. Combining a highly sensitive, low‐cost IP‐10 LFA‐based screening with targeted VL confirmatory testing could result in significant healthcare quality improvements and cost savings in settings with limited access to VL testing. [ABSTRACT FROM AUTHOR]