The objective of this research was to examine the fiscal impact of telemedicine consultations for acutely ill and injured children in a rural setting using pediatric intensive care unit (ICU) telemedicine. One hundred seventy-nine acutely ill and injured infants and children were cared for in the Mercy Redding ICU from April 2000 to April 2002. Data were gathered from these patients, including 47 patients who received 70 pediatric ICU telemedicine consultations during the same time period. Transport and hospital costs avoided were calculated for patients who received telemedicine consultations (Group 1) and for those not transferred due to the availability telemedicine consultations (Group 2), estimated to be one-half of the 179 patients (Group 2). The revenue generated in the rural ICU based on the ability to keep these patients was also determined. An estimated annual cost savings of $172,000 and $300,000 for transport and inpatient care was demonstrated for Group 1 and Group 2, respectively. Additionally, this program resulted in generating $186,000 and $279,000 of inpatient revenue annually for the two groups at the rural hospital. The cost of this program was approximately $120,000 per year. Given the substantial financial savings, support for underserved rural programs, and significant funds kept in the rural community, this may serve as a viable model for providing care to acutely ill and injured infants and children.