AIMS: The first aim of this study was to develop a model that predicts health and economic consequences of smoking cessation in Sweden, striving to follow the methodological recommendations to reflect the societal perspective and to use the health measure quality-adjusted life-years (QALYs). The second aim was to apply the model estimates to a smoking cessation intervention. METHODS: A Markov cost-effectiveness model was developed on smoking-related lung cancer, chronic obstructive pulmonary disease, and cardiovascular disease. Swedish primary data on medical treatment costs and quality-of-life weights were used, supplemented with secondary data on other societal effects and the disease and death risks. The model simulations were applied to a "Quit-and-Win" contest for mothers of pre-school children. In total, 238 women participated, with 34 sustained tobacco-free at 12-month follow-up. RESULTS: The cost-effectiveness model estimates a gain of 0.34 to 0.55 QALYs (discounted 3%), and cost savings of SEK 20-35,000 per female quitter in the age range 15 to 49 years. The cost-effectiveness analyses of the intervention showed intervention costs per quitter of SEK 7,850, and intervention costs per life-years saved (YLS) (discounted 3%) of SEK 13,200. The cost-utility analysis demonstrated cost savings and a gain of 16 QALYs. CONCLUSIONS: The cost-utility analysis estimated health gains and cost savings resulting from the "Quit-and-Win" contest. As the model estimates on the differences in societal cost between smokers and quitters are considerable, many tobacco control programmes would result in cost savings. The construction of an optimal mix of tobacco control policies, however, demands incremental calculations on a range of programmes.