The treatment of patients with compensated liver cirrhosis and small hepatocarcinomas remains controversial. Whereas partial hepatectomy (PH) is currently recommended, the role of orthotopic liver transplantation (OLT) has become progressively accepted. We used the techniques of decision analysis to measure the clinical benefits and the economic consequences of immediate resection versus transplantation in patients with compensated cirrhosis and who were diagnosed with small hepatocellular carcinoma (HCC). We restricted our analysis to patients with resectable carcinomas, which is either solitary tumor (< or = 5 cm in diameter), or multiple tumors (up to 3), none being > 3 cm in diameter and, in both cases, no tumor invasion of blood vessels. We took into account the risks of tumor spreading and dissemination and/or development of decompensated cirrhosis while waiting for donor organs because organ shortage is presented as the main obstacle to transplantation in these patients. Our analysis suggests that orthotopic liver transplantation (OLT) offers a substantial survival benefit compared with resection, ranging from a minimum of 1 year to a maximum of 4.7 years depending on treatment-related survival rates. However, the magnitude of this benefit relies on the availability of an organ donor; therefore, if the waiting period exceeds 6 to 10 months, depending on tumor growth pattern, the increase in life expectancy provided by transplantation is overwhelmed by the risks that patients face while waiting for transplantation. Consequently, partial resection becomes the preferred strategy. The predicted marginal cost-effectiveness ratios of transplantation compared with resection would range between $44,454 and $183,840 per additional year gained mainly influenced by the time delay before getting a transplant. We conclude that compared with partial hepatectomy (PH), OLT for resectable hepatocarcinoma(s) offers substantial survival benefit among well-targeted subgroups of patients as long as an organ donor is available within a maximal 6 to 10 months time delay, which is a plausible scenario in most centers with a liver transplant program. However, the marginal cost-effectiveness ratios incurred by this strategy are higher than that of many other current medical interventions.