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Up to 12% of the 800,000 patients who undergo mechanical ventilation in the United States every year require tracheostomies. A recent systematic review showed that early tracheostomy was associated with better outcomes: more ventilator-free days, shorter ICU stays, less sedation and reduced long-term mortality. However, the financial impact of early tracheostomies remain unknown.To conduct a cost-analysis on the timing of tracheostomy in mechanically ventilated patients.We extracted individual length of hospital stay and length of ICU stay data from the studies included in the systematic review from Hosokawa et al. We also searched for any recent randomized control trials on the topic that were published after this review. The weighted length of stay was estimated using a random effects model. Average daily hospital and ICU costs per patients were obtained from a cost study by Kahn et al. We estimated hospital and ICU costs by multiplying LOS with respective average daily cost per patient. We calculated difference in costs by subtracting hospital costs, ICU costs and total direct variable costs from early tracheotomy to late tracheotomy. 95% confidence intervals were estimated using bootstrap re-sampling procedures with 1000 iterations.The average weighted cost of ICU stay in patients with an early tracheostomy was $4316 less when compared to patients with late tracheostomy (95% CI: 403–8229). Subgroup analysis revealed that very early tracheostomies (<4 days) cost on average $3672 USD less than late tracheostomies (95% CI: –1309, 10,294) and that early tracheostomies (<10 days but >4) cost on average $6385 USD less than late tracheostomies (95% CI: –4396–17,165).This study shows that early tracheostomy can significantly reduce direct variable and likely total hospital costs in the intensive care unit based on length of stay alone. This is in addition to the already shown benefits of early tracheostomy in terms of ventilator dependent days, reduced length of stays, decreased pain, and improved communication. Further prospective studies on this topic are needed to prove the cost-effectiveness of early tracheostomy in the critically ill population.Early tracheostomy reduces ICU & hospital costs.Early tracheostomy reduces ICU length of stay.Findings are consistent after sensitivity analysis.