Pulse oximetry (PO) screening is used to screen newborns for critical congenital heart defects (CCHD). Analyses performed in hospital settings suggest that PO screening is cost-effective. We assessed the costs and cost-effectiveness of PO screening in the Dutch perinatal care setting, with home births and early postnatal discharge, compared to a situation without PO screening. Data from a prospective accuracy study with 23,959 infants in the Netherlands were combined with a time and motion study and supplemented data. Costs and effects of the situations with and without PO screening were compared for a cohort of 100,000 newborns. Mean screening time per newborn was 4.9 min per measurement and 3.8 min for informing parents. The additional costs of screening were in total €14.71 per screened newborn (€11.00 personnel, €3.71 equipment costs). Total additional costs of screening and referral were €1,670,000 per 100,000 infants. This resulted in an incremental cost-effectiveness ratio of €139,000 per additional newborn with CCHD detected with PO, when compared to a situation without PO screening. A willingness-to-pay threshold of €20,000 per gained QALY for screening in the Netherlands makes the screening likely to be cost-effective.Conclusion: PO screening in the Dutch care setting is likely to be cost-effective. What is Known: • Pulse oximetry is increasingly implemented as a screening tool for critical congenital heart defects in newborns. • Previous studies suggest that the screening in cost-effective and in the USA a reduction in infant mortality from critical congenital heart defects was demonstrated. What is New: • This is the first cost-effectiveness analysis for pulse oximetry screening in a setting with screening after home births, with screening at two moments. • Costs of pulse oximetry screening in a setting with hospital and homebirth deliveries were €14.71 and is likely to be cost-effective accordint to Dutch standards.