Objective. To assess the disease burden of rotavirus diarrhea in Peru as well the need for and the potential cost savings with a rotavirus vaccine in that country. Methods. To assess the burden of rotavirus diarrhea in Peru, we reviewed published and unpublished reports where rotavirus was sought as the etiologic agent of diarrhea in children. Rotavirus detection rates obtained from these studies were combined with diarrhea incidence rates from a number of national surveys in order to estimate both the burden of rotavirus diarrhea in the country and its associated medical costs. Results. Rotavirus is a significant cause of morbidity and mortality in Peruvian children. In their first 5 years of life, an estimated 1 in 1.6 children will experience an episode of rotavirus diarrhea, 1 in 9.4 will seek medical care, 1 in 19.7 will require hospitalization, and 1 in 375 will die of the disease. Per year, this represents approximately 384 000 cases, 64 000 clinic visits, 30 000 hospitalizations, and 1 600 deaths. The annual cost of medical care alone for these children is approximately US$ 2.6 million--and that does not take into account the indirect or societal costs of the illness and the deaths. Conclusions. Rotavirus immunization provides the prospect of decreasing the morbidity and mortality from diarrhea in Peru, but a vaccine regimen would have to be relatively inexpensive, a few dollars or less per child. Future cost-effectiveness analyses should explore the total costs (medical as well as indirect or societal) associated with rotavirus diarrhea. Newly licensed vaccines should be tested according to both their ability to avert deaths and their efficacy with fewer than three doses. All three of these factors could increase the cost savings associated with a rotavirus vaccine.