Background: In Uganda, the main stay for provision of human immunodeficiency virus (HIV) voluntary counseling and testing (VCT) has been at health facilities. Home based VCT on the other hand, was initiated in the country to improve service coverage. Objective: To evaluate the cost effectiveness of facility-and home-based HIV VCT strategies in rural southwestern Uganda. Methods: Data on costs and effectiveness of facility-and home-based HIV VCT intervention strategies was collected in two sub-Counties in rural southwestern Uganda. Costing was performed using the ingredients approach. Effectiveness was measured as the number of HIV sero-positive clients identified. Incremental Cost-Effectiveness Ratios (ICERs) were calculated from the provider perspective. Results: The cost per client tested were US$6.4 for facility based VCT and US$5.0 for home based VCT. The corresponding costs per positive case identified were US$86.5 and US$54.7 respectively. The incremental cost to providers per additional positive case identified by facility based VCT was US$3.5. Conclusion: Home based VCT was the least costly strategy per client tested and was also cost effective in identifying HIV sero-positive clients in rural areas. This strategy should therefore be promoted to improve service coverage and thereby facilitate early and extensive detection of clients eligible for treatment.