Background: We sought to determine if the reported improved performance of magnetic resonance imaging-ultrasound (MRI-US) fusion biopsy over systematic transrectal ultrasound-guided biopsy (TRUS) in the detection of prostate cancer justifies the added cost of the MR imaging. Methods: A decision-analytic Markov model with a lifetime horizon of 10 years was developed to evaluate diagnostic accuracy, long-term health outcomes, costs, and quality-of-life of two strategies (i.e., TRUS versus MRI-US fusion biopsy [prostate MRI followed potentially by MRI-US fusion biopsy]) as the initial diagnostic test in men with elevated prostate-specific antigen ( > 4 ng/ml) without prior evaluation. Probabilities of clinical events were obtained from published literature. Direct medical costs, including diagnostic and treatment-related costs, were derived from the Premier Hospital Database. Costs were inflated to 2015 US dollars and discounted at an annual rate of 3%. Health outcomes were measured in quality-adjusted life years (QALYs), which were determined based on published literature and expert opinion. We calculated the incremental cost-effectiveness ratio and performed sensitivity analyses to assess uncertainty. Results: The MRI-US fusion biopsy strategy yielded a lower average discounted cost ($5,358 versus $6,372) and higher total QALYs-gained (7.21 versus 7.19) than TRUS. The reduced expenditures associated with MRI-US fusion biopsy was primarily due to avoiding intervention for clinically insignificant prostate cancer. The results were robust with the sensitivity analyses. Conclusions: For men in the United States with an elevated PSA, the use of MRI-US fusion biopsy in the evaluation for prostate cancer represents a greater value than TRUS, the standard of care option. Widespread adoption of MRI-US fusion biopsy may serve to reduce the economic burden of prostate cancer.