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To determine the feasibility, accuracy and cost-effectiveness of a rapid, on-site, HIV testing strategy in a rural hospital, and to assess its impact on test turnaround time and the proportion of patients post-test counselled.Prospective comparison of two testing strategies [double rapid test on-site versus central enzyme-linked immunosorbent assay (ELISA)-based testing], and an economic evaluation.Hlabisa Hospital, a rural South African district hospital.A total of 454 consecutive adult inpatients requiring and consenting to HIV testing as part of their clinical management.Concordance between rapid tests, and between the rapid and ELISA strategies, test turnaround time, proportion of patients post-test counselled, and cost-effectiveness.HIV seroprevalence was 49.6%. Both rapid tests were concordant in all patients [one-sided 95% confidence interval (CI) of probability, 99.3-100]. The rapid strategy was 100% sensitive (95% CI, 97.9-100) and 99.6% specific (95% CI, 97.2-100) compared with the ELISA strategy. The mean interval between ordering a test and post-test counselling fell from 21 days prior to the introduction of the rapid test strategy to 4.6 days after its introduction (P < 0.00001). The proportion of patients post-test counselled increased to 96% from 17% after the introduction of the rapid test strategy (P< 0.00001). By using a double rapid test strategy the cost per patient post-test counselled was almost halved to US $11. Accuracy of the rapid strategy was not substantially increased by performing two tests.In high prevalence, resource-poor settings, rapid, on-site HIV testing is feasible, accurate and highly cost-effective, substantially increasing the number of patients post-test counselled. A single rapid test may be sufficient.