Abstract A study was carried out to examine the economic and qualitative aspects of nurse prescribing for patients, carers, nurses and other health care professionals. The design was a case study, without controls or randomisation, and involved patients, nurses, general practitioners and other health care professionals in GP fundholding practices, one in each region of England, that were designated by the Department of Health as demonstration sites for nurse prescribing. This paper reports the data from the economic analysis. The main outcome measures were changes in the frequency and cost of prescribing compared with a range of scenarios, and the impact on health professionals' time. There was no evidence to suggest that prescribing costs in the eight demonstration sites increased more than they would have done in the absence of nurse prescribing. It is relatively safe to conclude that the impact on prescribing costs in those sites was neutral. The range of uncertainty around the first-year costs in the demonstration sites is nevertheless high, in the order of £240,000. Further work is required to identify the economic impact of nurse prescribing with a larger sample of practices, to assess whether prescribing costs will be contained (preferably in relation to a control sample) and whether notional time savings are cash-releasing. Research is also needed to shed light on questions of appropriateness and effectiveness of prescribing.