To determine whether early removal of the indwelling Foley catheter after transurethral resection of the prostate (TURP) significantly shortens the hospital stay without causing additional morbidity and thus saves costs. For the year commencing 1 July 1991, 119 patients who had undergone TURP had their indwelling catheter removed on the first day after surgery. The results and morbidity of this group of patients were compared with those in 152 patients undergoing TURP during the previous year. The economic consequences of this protocol were calculated using both Medicare and CHAMPUS data. The demographics of the patients in both groups were similar. Post-operative complications occurred in 5% of the study patients and in 6.6% of controls; a transfusion was required in 2.5% and 1.3%, clot retention developed in 1.7% and 3.3% and the hospital stay was reduced from 3.1 to 1.28 days in the study and control patients, respectively. Using Medicare data, the mean cost saving of early catheter removal would be $829 and $1406 for patients aged < 70 and > 70 years, respectively. For CHAMPUS patients, the cost saving would be $1983. Early removal of the catheter after TURP did not increase morbidity and maintained the efficacy of the procedure. If this practice was adopted nationally, the savings resulting from the reduction in hospital stay would be considerable.