BACKGROUND: Providing additional Saturday rehabilitation can improve functional independence and health related quality of life at discharge and it may reduce patient length of stay, yet the economic implications are not known. The aim of this study was to determine from a health service perspective if the provision of rehabilitation to inpatients on a Saturday in addition to Monday to Friday was cost effective compared to Monday to Friday rehabilitation alone. METHODS: Cost utility and cost effectiveness analyses were undertaken alongside a multi-center, single-blind randomized controlled trial with a 30-day follow up after discharge. Participants were adults admitted for inpatient rehabilitation in two publicly funded metropolitan rehabilitation facilities. The control group received usual care rehabilitation services from Monday to Friday and the intervention group received usual care plus an additional rehabilitation service on Saturday. Incremental cost utility ratio was reported as cost per quality adjusted life year (QALY) gained and an incremental cost effectiveness ratio (ICER) was reported as cost for a minimal clinically important difference (MCID) in functional independence. RESULTS: 996 patients (mean age 74 (standard deviation 13) years) were randomly assigned to the intervention (n = 496) or the control group (n = 500). Mean difference in cost of AUD$1,673 (95% confidence interval (CI) -271 to 3,618) was a saving in favor of the intervention group. The incremental cost utility ratio found a saving of AUD$41,825 (95% CI -2,817 to 74,620) per QALY gained for the intervention group. The ICER found a saving of AUD$16,003 (95% CI -3,074 to 87,361) in achieving a MCID in functional independence for the intervention group. If the willingness to pay per QALY gained or for a MCID in functional independence was zero dollars the probability of the intervention being cost effective was 96% and 95%, respectively. A sensitivity analysis removing Saturday penalty rates did not significantly alter the outcome. CONCLUSIONS: From a health service perspective, the provision of rehabilitation to inpatients on a Saturday in addition to Monday to Friday, compared to Monday to Friday rehabilitation alone, is likely to be cost saving per QALY gained and for a MCID in functional independence. TRIAL REGISTRATION: Australian and New Zealand Clinical Trials Registry November 2009 ACTRN12609000973213.