© 2016 by De Gruyter 2016.Objective: There is an increasing body of literature supporting universal umbilical cord blood gas analysis (UCBGA) into all maternity units. A significant impediment to UCBGA's introduction is the perceived expense of the introduction and associated ongoing costs. Consequently, this study set out to conduct the first cost-effectiveness analysis of introducing universal UCBGA. Methods: Analysis was based on 42,100 consecutive deliveries =23 weeks of gestation at a single tertiary obstetric unit. Within 4 years of UCBGA's introduction there was a 45% reduction in term special care nursery (SCN) admissions >2499 g. Incurred costs included initial and ongoing costs associated with universal UCBGA. Averted costs were based on local diagnosis-related grouping costs for reduction in term SCN admissions. Incremental cost-effectiveness ratio (ICER) and sensitivity analysis results were reported. Results: Under the base-case scenario, the adoption of universal UCBGA was less costly and more effective than selective UCBGA over 4 years and resulted in saving of AU$641,532 while adverting 376 SCN admissions. Sensitivity analysis showed that UCBGA was cost-effective in 51.8%, 83.3%, 99.6% and 100% of simulations in years 1, 2, 3 and 4. These conclusions were not sensitive to wide, clinically possible variations in parameter values for neonatal intensive care unit and SCN admissions, magnitude of averted SCN admissions, cumulative delivery numbers, and SCN admission costs. Conclusions: Universal UCBGA is associated with significant initial and ongoing costs; however, potential averted costs (due to reduced SCN admissions) exceed incurred costs in most scenarios.