The cost of schizophrenia has been estimated at $11.6 to $19.5 billion annually. About two-thirds of this cost is due to lack of productivity by schizophrenic patients and about one-fifth to treatment costs. The estimate might be considerably higher if better figures were available on the cost of maintaining patients in the community. In the absence of more effective treatment, the savings from the current trend toward shorter hospitalization cannot be expected to decrease-and may actually increase-the overall costs of schizophrenia to society. The authors make recommendations aimed at reducing the cost by helping schizophrenic patients to be more productive through a system of community alternative-care facilities, increased rehabilitation services, aftercare, and research.