At present, asthma represents a substantial burden on health care resources in all countries so far studied. The costs of asthma are largely due to uncontrolled disease, and are likely to rise as its prevalence and severity increase. Costs could be significantly reduced if disease control is improved. A large proportion of the total cost of illness is derived from treating the consequences of poor asthma control-direct costs, such as emergency room use and hospitalizations. Indirect costs, which include time off work or school and early retirement, are incurred when the disease is not fully controlled and becomes severe enough to have an effect on daily life. In addition, quality of life assessments show that asthma has a significant socioeconomic impact, not only on the patients themselves, but on the whole family. Underuse of prescribed therapy, which includes poor compliance, significantly contributes towards the poor control of asthma. The consequences of poor compliance in asthma include increased morbidity and sometimes mortality, and increased health care expenditure. To improve asthma management, international guidelines have been introduced which recommend an increase in the use of prophylactic therapy. The resulting improvements in the control of asthma will reduce the number of hospitalizations associated with asthma, and may ultimately produce a shift within direct costs, with subsequent reductions in indirect costs. In addition, costs may be reduced by improving therapeutic interventions and through effective patient education programmes. This paper reviews current literature on the costs of asthma to assess how effectively money is spent and, by estimating the proportion of the cost attributable to uncontrolled disease, will identify where financial savings might be made.