Standard antibiotic treatment of infections has become more difficult and costly due to treatment failure associated with the rise in bacterial resistance. New antibiotics that can overcome such resistant pathogens have the potential for great clinical and economic impact. Linezolid is a new antibiotic that is effective in the treatment of both antibiotic-susceptible and antibiotic-resistant Gram-positive bacterial infections, including those resistant to other available antibiotics. This breadth of activity is unique in existing antibiotics for Gram-positive bacteria and serves as the rationale for exploring the hypothesis that linezolid is an appropriate choice when considering empirical treatment of cellulitis in complicated or compromised patients in the nosocomial setting. A decision-modelling approach was used to compare the predicted first-line treatment efficacy and direct medical costs of linezolid with standard treatment of cellulitis among hospitalized patients. For the purposes of this analysis, standard care is defined along two main pathways: (1) initiating care with intravenous (iv) flucloxacillin, switching to vancomycin if the pathogen is found to be resistant to flucloxacillin, or maintaining flucloxacillin if the pathogen is found susceptible, or when culture and sensitivity analysis is inconclusive; or (2) initiating care with vancomycin, switching to iv flucloxacillin if the pathogen is found susceptible to flucloxacillin, maintaining vancomycin if the infection is found resistant, or when culture and sensitivity are inconclusive. For those patients taking iv flucloxacillin, a switch to oral flucloxacillin was allowed when clinically appropriate. We hypothesized that the cost of care of initiating treatment with linezolid would be less than that for both vancomycin and flucloxacillin in resistance risk ranges typically encountered in UK hospitals. In addition, while the registration trials showed equivalence of linezolid with the comparators in known or suspected methicillin-resistant Staphylococcus aureus (MRSA) and in known or suspected methicillin-susceptible Staphylococcus aureus (MSSA) (vancomycin and oxacillin) respectively, we hypothesized that first-line success rates would be higher in empiric treatment with linezolid. Efficacy data were obtained from recent clinical trials with linezolid and standard treatment, and medical resource utilization was obtained from an expert panel of clinicians who were questioned regarding resistant and susceptible infections separately. UK hospital direct medical costs of treatment were determined using standard costing techniques. Base case analyses assumed a residual 80% unknown pathogen rate after culture and susceptibility based on a physician survey and supported in the literature. The analysis in this model predicts that initiating empirical treatment of cellulitis with linezolid will (1) result in higher overall success rates than flucloxacillin for first-line treatment, regardless of resistance risk and (2) be less costly than initiating treatment with flucloxacillin when the likelihood of a patient being infected by a resistant pathogen is greater than 24.1%. Furthermore, initiating treatment with linezolid is predicted to result in higher overall success rates and be less costly than vancomycin across the entire spectrum of the patients' risk of being infected by a resistant pathogen.