Abstract This paper deals with the cost analysis of a two dissimilar-unit cold standby redundant system subject to inspection and two types of repair where each unit of the system has two modes, normal and failed. It is assumed that the failure, repair, replacement and inspection times are stochastically independent random variables each having an arbitrary distribution. The cold standby unit replaces the failed operative unit after a random amount of time. An inspection is required to decide whether it needs type I (minor repair) or type 2 (major repair). In this system the repairman is not always available with the system, but is called whenever the operative unit fails. The system is analysed by the semi-Markov process technique. Some reliability measures of interest to system designers as well as operations managers have been obtained. Pointwise availability, steady-state availability, busy period by a server and the expected cost per unit time of the system are obtained. Certain important results have been derived as particular cases.