Background: The strategies for the management of onychomycosis have changed since the availability of the newer generation of antifungal agents, particularly, itraconazole and terbinafine. Itraconazole (1-week pulse) therapy may have higher efficacy and an improved adverse-effects profile compared to the continuous therapy regimen. Objective: We performed a pharmacoeconomic evaluation of the most commonly used treatments in Germany for toenail onychomycosis from a health care payer perspective. Methods: A 5-step approach was used. Firstly, the purpose of the study, the comparator drugs, their dosage regimens and the time frame of the analysis were defined. Next, the medical practice and resource consumption patterns associated with the treatment of onychomycosis were identified. In step III, a meta-analysis was used to determine the relative efficacy of the comparator drugs. In step IV, a decision tree of the treatment algorithms was constructed for each comparator. The expected cost analysis and cost-effectiveness analysis were also performed. Finally, a sensitivity analysis was carried out. Results: For the four main comparator drugs used to treat toenail onychomycosis in Germany, the clinical response rates (clinical cure plus marked improvement) at the end of the follow-up period (month 12 after starting therapy) were, for itraconazole (1-week pulse dosing): 89.8 ± 3% (mean ± SE), terbinafine: 79.4 ± 10%, itraconazole (continuous dosing): 77.5 ± 9%, and ciclopirox nail varnish: 55 ± 5%. Itraconazole (1-week pulse dosing) was most cost-effective at DM 1,107 per successful treatment, followed by oral terbinafine at DM 1,224, ciclopirox nail varnish and itraconazole (continuous dosing). Sensitivity analyses indicated that itraconazole (1-week pulse dosing) and terbinafine had similar cost-effectiveness ratios. Conclusion: Itraconazole is an effective, broad-spectrum triazole used as continuous or pulse therapy in the treatment of onychomycosis. Itraconazole (1-week pulse) and terbinafine are the most cost-effective therapies for toenail onychomycosis.