OBJECTIVE This study was designed to measure the direct medical charges for patients with and without diabetes who experience myocardial infarction. METHODS We completed a retrospective cohort analysis (from the third-party payer perspective) to determine the total direct medical charges (eg, hospitalizations, outpatient visits, pharmacy, and emergency room visits) incurred by an inner city sample of 293 patients during the 12 months following myocardial infarction during the period from January 1993 through February 1997. RESULTS The 87 patients with diabetes had a higher per patient total direct medical charge (inclusive of initial hospitalization) compared to the 206 patients without diabetes ($18,577 versus $26,414) and approximately $3000 more per person year of observation. Hospitalizations (initial and during the follow-up period) accounted for 88% of the total direct medical charges. The mean charge for the initial hospitalization was higher for patients with diabetes ($12,730 versus $15,394). In a subset, the mean charge per cardiovascular-related hospitalization that occurred during the follow-up period was also higher for patients with diabetes ($6344 versus $9648). CONCLUSIONS Consistent with what we expected, patients with diabetes incurred higher total direct medical charges as a result of and following myocardial infarction. These data can be used in future cost-effectiveness evaluations for therapies developed to treat patients with diabetes who experience myocardial infarction or for therapies designed to reduce the risk of macrovascular complications associated with diabetes.