There are indications of beneficial short-term effect of pre-operative exercise in reducing pain and improving activity of daily living after total hip replacement (THR) and total knee replacement (TKR) surgery. Though, information from studies conducting longer follow-ups and economic evaluations of exercise prior to THR and TKR is needed. The aim of the study was to analyse 12-month clinical effect and cost-utility of supervised neuromuscular exercise prior to THR and TKR surgery.The study was conducted alongside a randomised controlled trial including 165 patients scheduled for standard THR or TKR at a hospital located in a rural area of Denmark. The patients were randomised to replacement surgery with or without an 8-week preoperative supervised neuromuscular exercise program (Clinical Trials registration no.: NCT01003756). Clinical effect was measured with Hip disability and Osteoarthritis Outcome Score (HOOS) and Knee injury and Osteoarthritis Outcome Score (KOOS). Quality adjusted life years (QALYs) were based on EQ-5D-3L and Danish preference weights. Resource use was extracted from national registries and valued using standard tariffs (2012-EUR). Incremental net benefit was analysed to estimate the probability for the intervention being cost effective for a range of threshold values. A health care sector perspective was applied.HOOS/KOOS quality of life [8.25 (95% CI, 0.42 to 16.10)] and QALYs [0.04 (95% CI, 0.01 to 0.07)] were statistically significantly improved. Effect-sizes ranged between 0.09-0.59 for HOOS/KOOS subscales. Despite including an intervention cost of €326 per patient, there was no difference in total cost between groups [€132 (95% CI -3942 to 3679)]. At a threshold of €40,000, preoperative exercise was found to be cost effective at 84% probability.Preoperative supervised neuromuscular exercise for 8 weeks was found to be cost-effective in patients scheduled for THR and TKR surgery at conventional thresholds for willingness to pay. One-year clinical effects were small to moderate and favoured the intervention group, but only statistically significant for quality of life measures.ClinicalTrials.gov ( NCT01003756 ) October 28, 2009.