OBJECTIVE: The Labrador Telemedicine Project looked at the effectiveness of a personal, computer-based store and forward telemedicine system between the remote community of Black Tickle in northern Canada and a small regional hospital in Goose Bay, Labrador.METHOD: The nurse in the community captured video pictures, audio and text on all 43 cases involving 43 initial telemedicine consultations and 40 follow-up telemedicine consultations that occurred between Apr. 1, 1998, and Mar. 31, 1999. This information was stored in an electronic case file and sent to the hospital in Goose Bay, where the physicians reviewed the cases. Transmission was via microwave with a band width equivalent to an ordinary copper wire.PRINCIPAL RESULTS: This technology allowed the physician to make more informed decisions regarding patient management and the need for costly transfer. The nurse in the remote community felt more confident in treating the patient and provided a higher quality of care. Of 32 patients who responded to a patient satisfaction questionnaire, 84.4% believed that their care was much better, 15.6% that it made no difference and none believed that it was not as good as before. Fifty-one percent thought they had faster access to the physician. More patients were treated in the community, resulting in a reduced number of patients being transferred by air from the remote nursing station to the regional hospital. The cost of the system was $52 470. Assuming biennial replacement of the system equipment, the regional health authority will save $20 877 per year in patient transportation and the patients will save $8008 per year.CONCLUSIONS: This pilot project demonstrates that a store and forward telemedicine application is clinically useful and is associated with a decrease in health care costs. The technology can be applied effectively in similar remote community settings.