The purpose of the study was to investigate the epidemiology and medical costs of systemic lupus erythematosus (SLE) in Taiwan. Cases of SLE were identified from the National Health Insurance Research Database with corresponding International Classification of Diseases, Ninth Revision (ICD-9) code 710.0 from January 2000 to December 2007. Age and sex-specific incidences were estimated by dividing the incidence number by population data obtained from the Department of Statistics, Ministry of the Interior. During the study period, 22,182 cases were identified. The average annual incidence rate was 8.1 per 100,000. The incidence was especially high in women of 20-54 years. The female:male incidence ratio increased with age to a peak in the age group of 40-44, and then declined. The prevalence increased steadily during the study period from 42.2/100,000 in 2000 to 67.4/100,000 in 2007, while the incidence decreased steadily from 9.9/100,000/year in 2001 to 6.8/100,000/year in 2007. The average cost was US$71.5 for each outpatient service and US$1922.3 for each hospitalization. This is the first epidemiologic study of both pediatric and adult SLE in Taiwan. The incidence and prevalence were higher than in most reports on Whites. The sex ratio was similar to that of Whites, with a marked female predominance, especially during reproductive age. There was a probable lower survival rate for male patients.