To estimate the direct and indirect costs of three cataract surgery procedures: extracapsular cataract extraction with intra-ocular lens implantation (ECCE-IOL), phacoemulsification (PHACO) and manual small incision cataract surgery (MSICS) using economic costing principles in a well-established eye care programme (Aravind Eye Hospital) in Tamil Nadu, South India during 2000-01. Previous literature suggests that PHACO and MSICS have similar effectiveness. The average unit cost for each surgical procedure was calculated from the societal perspective using economic costing methods. Total annual provider's direct costs for each input to surgery were calculated and apportioned appropriately to different cataract surgery techniques using a 'micro-costing approach'. The patient's direct and indirect costs for each procedure were calculated by interviewing staff and patients and by using assumptions about prices for relevant cost items such as transportation, food, medicine, spectacles and economic productivity loss. Average provider's direct costs were highest for PHACO procedures (25.55 US dollars) compared to MSICS (17.03 US dollars) and ECCE-IOL (16.25 US dollars). The difference can be attributed to the cost of equipment and materials. Average direct and indirect patient costs were highest for ECCE-IOL (19.85 US dollars), while the costs for PHACO and MSICS were identical (12.37 US dollars). ECCE-IOL had the highest total costs and MSICS had the lowest total costs from the societal perspective. Our results suggest that MSICS may have a lower societal cost than other options. Government and NGO hospitals providing cataract surgeries should invest in regular cost analyses, reviews of the literature on effectiveness, and formal cost-effectiveness analyses in order to plan economically efficient interventions. Considering the small incremental cost for providers (less than 1 US dollar), improved outcomes, and lower patient costs, we also believe that MSICS is an important technique to use in efforts to eliminate cataract blindness in India and this result may be generalised to other developing countries.