Objective Management options for colorectal cancer have expanded in recent years. We estimated average lifetime cost of care for colorectal cancer in Ireland in 2008, from the health care payer perspective. Method A decision tree model was developed in Microsoft EXCEL. Site and stage-specific treatment pathways were constructed from guidelines and validated by expert clinical opinion. Health care resource use associated with diagnosis, treatment and follow-up were obtained from the National Cancer Registry Ireland (n=1,498 cancers diagnosed during 2004-2005) and three local hospital databases (n=155, 142 and 46 cases diagnosed in 2007). Unit costs for hospitalisation, procedures, laboratory tests and radiotherapy were derived from DRG costs, hospital finance departments, clinical opinion and literature review. Chemotherapy costs were estimated from local hospital protocols, pharmacy departments and clinical opinion. Uncertainty was explored using one-way and probabilistic sensitivity analysis. Results In 2008, the average (stage weighted) lifetime cost of managing a case of colorectal cancer was €39,607. Average costs were 16% higher for rectal (€43,502) than colon cancer (€37,417). Stage I disease was the least costly (€23,688) and stage III most costly (€48,835). Diagnostic work-up and follow-up investigations accounted for 4 and5% of total costs, respectively. Cost estimates were most sensitive to recurrence rates and prescribing of biological agents. Conclusion This study demonstrates the value of using existing data from national and local databases in contributing to estimating the cost of managing cancer. The findings illustrate the impact of biological agents on costs of cancer care and the potential of strategies promoting earlier diagnosis to reduce health care resource utilisation and care costs. © 2011 Springer-Verlag.