The pharmacoeconomic evaluation of atypical antipsychotics for the treatment of schizophrenia involves documentation of clinical effectiveness, quality of life and medical cost outcomes. The findings of pharmacoeconomic studies assist psychiatrists and mental healthcare decision-makers in identifying therapies that provide the greatest benefit to patients at the most acceptable cost. The cost-effectiveness of the newer atypical antipsychotics has been examined using non-controlled cohort studies (either retrospective or prospective), modelling studies or randomised clinical trials. The evidence, from a variety of studies, indicates that clozapine is a cost-effective treatment for neuroleptic refractory schizophrenia. Risperidone and olanzapine may be cost neutral, or at best slightly cost saving, compared with conventional antipsychotics, although they do improve patient clinical effectiveness and quality of life outcomes. There is too little data on pharmacoeconomic outcomes for sertindole and quetiapine to make any conclusions about their cost-effectiveness in treating schizophrenia.