OBJECTIVES. The purpose of the study was to determine the clinical and economic impact of alternative contraceptive methods. METHODS. Direct medical costs (method use, side effects, and unintended pregnancies) associated with 15 contraceptive methods were modeled from the perspectives of a private payer and a publicly funded program. Cost data were drawn from a national claims database and MediCal. The main outcome measures included 1-year and 5-year costs and number of pregnancies avoided compared with use of no contraceptive method. RESULTS. All 15 contraceptives were more effective and less costly than no method. Over 5 years, the copper-T IUD, vasectomy, the contraceptive implant, and the injectable contraceptive were the most cost-effective, saving $14,122, $13,899, $13,813, and $13,373, respectively, and preventing approximately the same number of pregnancies (4.2) per person. Because of their high failure rates, barrier methods, spermicides, withdrawal, and periodic abstinence were costly but still saved from $8933 to $12,239 over 5 years. Oral contraceptives fell between these groups, costing $1784 over 5 years, saving $12,879, and preventing 4.1 pregnancies. CONCLUSIONS. Contraceptives save health care resources by preventing unintended pregnancies. Up-front acquisition costs are inaccurate predictors of the total economic costs of competing contraceptive methods.