An estimated 26% of women of reproductive age (i.e., 18-44 years) smoked in 1993, and approximately 19%-27% of women smoke during pregnancy. Smoking during pregnancy is causally associated with an annual estimated 32,000-61,000 low-birthweight infants and 14,000-26,000 admissions to neonatal intensive-care units. The estimated smoking-attributable direct medical-care costs for chronic conditions in 1993 were $50.0 billion; however, this estimate omitted the direct medical costs of tobacco exposure for infants and children and most of these costs for pregnant women. To derive 1995 estimates of the smoking-attributable costs for direct medical expenditures (i.e., inpatient, physician, hospital outpatient, and emergency department costs) related to pregnancy outcomes, the University of California at Berkeley and CDC analyzed data from the 1987 National Medical Expenditures Survey (NMES-2). This report summarizes the findings, which indicate substantial smoking-attributable direct medical expenditures for pregnant women and newborns.