Psoriasis is a chronic inflammatory, immune-mediated skin disorder that affects 1.5–1.8 million people in Italy. The most common form of the disease is chronic plaque psoriasis, affecting about 90% of psoriasis patients, with about 20%–30% of them suffering from a moderate or severe condition. Little information is available about the economic impact of psoriasis in European countries. The primary objective of this study was to perform a cost-of-illness analysis of patients with moderate and severe plaque psoriasis in Italy. Therefore, direct, indirect costs, and intangible costs (quality of life – QoL) were assessed. In this national, multicenter, prospective, 3-month cost-of-illness study of moderate and severe plaque psoriasis, direct and indirect costs were assessed from the patient, third-party payer (National Health Service, NHS), and societal perspectives. From November 2003 to October 2004 consecutive patients were enrolled over a 1-year period, in order to minimize seasonal fluctuations in disease severity. 150 patients enrolled in 6 investigational sites in Italy, completed the study, and were eligible to be analyzed according to the study protocol. Intangible costs (QoL) were measured using SF36 and DLQI questionnaires. The mean total cost for psoriasis (average Psoriasis Area Severity Index [PASI] score 21.4), including direct and indirect items, was €8,371.61 per patient per year. The mean cost for patients with moderate disease (PASI ≤ 20) was €5,226.04, while the mean cost for patients with more severe disease (PASI > 20) was €11,434.40 per year. Disease heavily affected QoL measured using SF36, and the impairment was greater in patients affected by a more severe form of disease. Moderate and severe plaque psoriasis is associated with extremely high costs, which are related to disease severity. Data from this study show that the more severe plaque psoriasis, the higher the direct and indirect costs for its management. Direct costs are higher than indirect costs; hospitalization represents the most significant item, accounting for 30% of the total expenses. QoL in moderate and severe plaque psoriasis is low compared with the population at large, confirming the high impact of plaque psoriasis on QoL. The relatively high average annual costs per patient point to the need for a more efficient and long-term control of psoriasis.