Suspected penicillin allergy is common among hospitalised patients, but the quality of the information given by the patient is often doubtful. Alleged penicillin allergic are likely to be treated with more toxic, broad-spectrum, and more expensive antibiotics, with effects on microbial resistance patterns and public economy as a consequence. We performed a cross-sectional case-control study with two visits to all clinical departments of a large university hospital in order to find in-patients with medical files labelled "penicillin allergy" or who reported penicillin allergy upon admission. Patient histories were obtained via a questionnaire, and they were offered investigation for penicillin allergy with specific IgE, basophil histamine release, skin prick tests, intradermal tests and drug challenge tests. Finally, the pharmaco-economical consequences of the penicillin allergy were estimated. In a cohort of 3642 patients, 96 fulfilled the inclusion criteria giving a point-prevalence of alleged penicillin allergy of 5% in a hospital in-patient population. Mean time elapsed since the alleged first reaction to penicillin was 20 years. The skin was the most frequently affected organ (82.2%), maculo-papular exanthema (35.4%) and urticaria (10.4%) being the most frequently reported reactions. 25% did not recall the time of their reaction. 82.2% did not remember the name of the penicillin they reacted to. 34.8% had been treated with penicillins after suspicion of penicillin allergy had been raised. None of these reacted to penicillins. 33.3% of the patients receiving antibiotics during their current hospitalisation were prescribed penicillins. 2% developed non-severe exanthema. The average acquisition costs for antibiotics to penicillin allergic patients were euro 278, compared to euro 119 had they been non-allergic. The prevalence of suspected penicillin allergy was lower than reported elsewhere. A substantial number of patients failed to recall basic information about their alleged allergy. Patients reporting penicillin allergy upon admission and labels stating penicillin allergy on medical files are ignored in almost a third of patients receiving antibiotics. The acquisition costs for antibiotics to penicillin allergic patients were higher, compared to the cost had the patients been non-allergic.