SUMMARY OBJECTIVES: To determine the change in willingness to pay (WTP) measured at pregnancy and at postpartum before and after knowing hospital costs among women who gave birth by normal delivery (NL) and caesarean section (CS) and to identify factors affecting the change in WTP. METHODS: A prospective study was conducted from May to August 2009 at Tribhuvan University Teaching Hospital, Kathmandu, Nepal. WTP for total costs was measured by double-bound dichotomous contingent valuation and an open-ended technique. The trend of WTP over time was tested using longitudinal analysis. Associated factors to the positive or negative change in WTP were analysed by logistic regression. RESULTS: Of 438 pregnant women followed up both at pregnancy and postpartum, two-thirds were willing to pay for services at the initial bid of the double-bound method by $60-$85 for NL and $110-$170 for CS. There were no significant differences in the median WTP measured during pregnancy between NL and CS. The WTP of both groups changed significantly over time (P < 0.001). Caesarean section, perception of good care, information provided on delivery costs and discussion with family about cost were significantly associated with changes from pregnancy to the postpartum period. CONCLUSIONS: In low-income countries such as Nepal, where out-of-pocket health care expenditures are common, women perceived the health benefit of delivery care in hospital, especially for emergency CS. Their WTP had changed substantially after delivery, and awareness of the associated factors is essential for further policy and planning to improve the services and utilization.