This study reports an analysis of the relative importance of laboratory antibiotic, and per diem costs of caring for 58 patients with serious Staphylococcus aureus nosocomial infections. Laboratory costs accounted for 2%, antibiotics for 21%, and per diem costs for 77% of total infection-related costs. Only 45% of patients were hospitalized for additional days specifically because of infection, but these patients stayed an average of 18 extra days. Nosocomial infections with S. aureus resistant to penicillinase-resistant penicillins (PRP) were more frequently associated with additional infection-related days of hospitalization than were PRP-susceptible infections. The cost of PRP-resistant infections was also significantly greater than PRP-susceptible infections, primarily because of the costs of additional days of hospitalization. Rational strategies to control costs of nosocomial infection should focus on two approaches: (1) prevention and (2) reduction of acute hospital days attributable to infections.