Objective. To investigate health care utilization of children with obstructive sleep apnea syndrome (OSAS) 1 year after adenotonsillectomy (T&A). Methods. A longitudinal, case-controlled, prospective study was conducted at Clalit Health Care Services (CHS), a health maintenance organization in the southern region of Israel. We defined 3 groups of children: 1) children who had OSAS and were treated with T&A (n = 130); 2) children who had OSAS and did not undergo surgery (n = 90); and 3) control subjects who were matched by age, sex, and area of residency (n = 520) and randomly selected from the CHS database. OSAS was verified with polysomnography studies in all patients. Indices of health care utilization were analyzed 1 year before and 1 year after T&A. Medical records in the emergency department and during hospitalization were reviewed for diagnosis before the polysomnography diagnosis. Results. Mean age of all children with OSAS was 5.6 ± 3.6 years. Total annual health care costs were reduced by one third in children who underwent T&A, whereas there was no change in the control and untreated OSAS groups. T&A was associated with a 60% reduction in the number of new admissions, 39% reduction in emergency department visits, 47% reduction in the number of consultations, and 22% reduction in costs for prescribed drugs. In group 2, the total costs were similar in years 1 and 2. Conclusions. T&A significantly reduces health care utilization in children with OSAS. Untreated children with moderate and severe OSAS will continue to consume high levels of health care resources. Increased morbidity among children with OSAS is mainly related to upper respiratory tract infections.