In achieving a more effective use of resources in the National Health Service (NHS), the medical profession has a role to play by improving cost efficiency in clinical practice. This role implies that doctors should have some knowledge of medical costs. In order to determine the extent of this knowledge, sixty-seven hospital clinicians, seventy-four general practitioners and a control group of novice clinical students completed a multiple choice questionnaire concerned with the costs of medical care. The doctors' knowledge of costs was poor and only marginally better than that of the students. The average number of correct responses obtained to twenty questions was 6.2 by the hospital clinicians, 5.5 by the general practitioners and 4.7 by the students. Performance on questions on overall NHS costs was better (P less than 0.01) than that achieved on questions on diagnostic costs, therapeutic costs and hospital costs. Knowledge of the costs of some commonly prescribed drugs, such as digoxin and ampicillin, was minimal. Ignorance of the financial consequences of clinical decisions may hamper attempts to improve the cost efficiency of medical practice.