Estimating preferences for states of health has been an active area of research in recent years. Unlike psychophysical approaches, which discriminate levels of health status, preference-based approaches incorporate values or utilities for health outcomes and can be used in cost-effectiveness analyses to aid resource allocation decisions. This chapter considers issues and controversies involved in using preference-based measures in economic evaluation in health care, with a particular emphasis on cost-utility analysis and the estimation of quality-adjusted life years. Topics considered include techniques for measuring preferences, the use of preference-based classification systems, the relationship between patient and community preferences, methods for obtaining utilities from clinical trials, mapping health status from health utilities, the development of "off-the-shelf" preference weights, and proposed alternatives to quality-adjusted life years. We also consider applications of cost-utility analyses to public health interventions. Although cost-utility analyses have become more popular recently, many challenges remain for the field. Widespread acceptance of the methodology likely awaits more consensus on measurement techniques, as well as educational efforts in the public health and medical communities on the usefulness of the approach.