A deterministic realistic age-structured model was used to predict the impact of vaccination on the incidence of varicella and zoster. Unit costs, estimated from literature, were applied to the predicted health outcomes. Various vaccination programs were investigated and a sensitivity analysis was performed. Assuming no impact of vaccination on zoster, varicella vaccination is estimated to cost 45,000 dollars, 51,000 dollars and 18,000 dollars per life-year gained from the health payer's perspective for infant, infant with catch-up campaign, and preteen programs, respectively. From the societal perspective, mass infant varicella vaccination was estimated to be highly cost saving in Canada. Importantly, infant varicella vaccination could result in a short- to medium-term increase of zoster incidence and thus cause vaccination to be highly cost-ineffective (118,000 dollars per life-year gained) under the health payer's perspective. From a health payer's perspective the preteen vaccination is the only strategy that is deemed cost-effective. The cost-effectiveness of infant vaccination rests heavily on the unknown relationship between varicella and zoster.