Functional improvement and costs were analysed in 54 patients after 23 hip and 31 knee arthroplasties. All patients had destructive RA (ARA criteria 5-8). Mean stay at the surgical department was 15 and 26 days respectively, regardless of preoperative locomotion status, sex, or age, but additional in-patient rehabilitation was significantly longer after knee than hip arthroplasty (11 days and 4 days, respectively). Subjective and objective status as evaluated with total locomotion score showed significant improvement 6 months after operation. The degree of over-all improvement was equal for men and women, for all age groups, and for the different score groups. Quality of life improved with pain relief, improved sleep, and improved walking ability. The mean total costs were 34,902 SEK for hip and 56,200 SEK for knee replacement, including in-patient rehabilitation. Costs for home help were reduced from 693,600 SEK to 479,400 SEK. Severely disabled patients showed satisfactory improvement, but did not reach the functional level achieved by patients who were less disabled at the time of operation. Costs were not significantly higher for the former category.