PURPOSE: The recent Breast Cancer Prevention Trial has shown that tamoxifen may prevent invasive breast cancer. We used a Markov model to estimate the long-term effects of chemoprevention with tamoxifen on survival, quality-adjusted survival, and health care costs. METHODS: We used a hypothetical cohort of women with breast-cancer risk similar to that of participants in the Breast Cancer Prevention Trial, and a computer-based decision analysis (Markov model and 500 Monte Carlo simulations) to model the outcomes of interest. Survival calculations were from Surveillance, Epidemiology, and End-Results (SEER) data; preference ratings from a time trade-off questionnaire administered to a group of average-risk women; and cost estimates from the Group Health Cooperative of Puget Sound and the Health Care Financing Administration. We obtained utility measures for quality-adjustment by administering a time trade-off questionnaire to a group of community-based women. RESULTS: Use of tamoxifen prolonged the average survival of cohort members by 69 days (95% probability interval [PI] 27 to 117) for those who started use at age 35 years; 40 days (95% PI 16 to 67) for those who started use at age 50 years; and 27 days (95% PI 14 to 40) for those who started use at age 60 years. Tamoxifen extended quality-adjusted survival by 38 days (95% PI 0.1 to 82) at age 35, 25 days (95% PI 0 to 50) at age 50, and 22 days (95% PI 5 to 39) days at age 60. Chemoprevention with tamoxifen cost $46,619 (95% PI $27,928 to $98,796) per life year life saved for women who started at age 35; for women over age 50, it cost more than $50,000 per life year saved. DISCUSSION: Tamoxifen use may improve long-term survival and quality-adjusted survival among women who are at increased risk of breast cancer, but this benefit diminishes with age. Tamoxifen is cost-effective in comparison with other cancer treatment strategies for younger women only.