Background: Inborn errors of metabolism (IEM) are a significant cause of morbidity and mortality in North Africa and the Middle East. With the evident success of neighbouring countries in initiating neonatal screening for IEM, the Libyan Authorities are now considering introducing neonatal screening for phenylketonuria (PKU) in Libya in the first instance, with the prospect of expanding the programme to cover other IEM in the future. Objective: To estimate the cost effectiveness of neonatal screening for PKU compared with no neonatal screening in Libya. Methods: A decision model was constructed to estimate the cost effectiveness of neonatal screening for PKU, from the perspective of Libyan society. Healthcare resource use and other input parameters were based on expert opinion. Results: The expected discounted cost to Libyan society of screening over 15 years and managing ∼374 patients with detected PKU over their lifetime was estimated to be $US213.6 (95% CI 211.9, 214.3) million (year 2007-8 values). The current expected discounted cost of managing these same PKU patients over their lifetime as a result of not screening was estimated to be $US321.2 (95% CI 318.0, 322.7) million. Hence, screening would save Libyan society $US107.6 (95% CI 105.5, 109.1) million over the lifetime of PKU patients and lead to an additional 6947 life-years (95% CI 6837, 7056). The expected cost per undiscounted life-year gained was estimated to be -$US15 500 (95% CI -16 600, 1100). There would be a 90% return on investment in the screening programme since society would gain $US1.9 for every $US1 invested. Probabilistic sensitivity analysis demonstrated that the screening programme has a 0.95 probability of being cost effective even at a willingness-to-pay threshold of $US4000 per life-year gained. Conclusions: Within the model's limitations, neonatal screening for PKU appears to offer Libyan society a strategy that is cost effective compared with no neonatal screening.