Objective: To evaluate the cost of endoscopic third ventriculostomy (ETV) compared to ventriculoperitoneal shunt (VPS) in the treatment of hydrocephalus in children. Method: We studied 103 children with hydrocephalus, 52 of which were treated with ETV and 51 with VPS in a prospective cohort. Treatment costs were compared within the first year after surgery, including subsequent surgery or hospitalization. Results: Twenty (38.4%) of the 52 children treated with VPS needed another procedure due to shunt failure, compared to 11 (21.5%) of 51 children in the ETV group. The average costs per patient in the group treated with ETV was USD$ 2,177,66±517.73 compared to USD$ 2,890.68±2,835.02 for the VPS group. Conclusions: In this series there was no significant difference in costs between the ETV and VPS groups.