Background: The Checkmate 141 randomized trial found that patients with platinum-refractory, recurrent or metastatic (R/M) squamous-cell carcinoma of the head and neck (SCCHN) treated with nivolumab had significantly longer overall survival than those treated with standard, single-agent therapy. However, nivolumab is more expensive than standard treatment. We conducted a cost-effectiveness analysis of nivolumab for the treatment of R/M SCCHN. Methods: We constructed a Markov model to simulate treatment with nivolumab or other single-agent therapy (docetaxel, cetuximab, or methotrexate) for patients with R/M SCCHN. Transition probabilities including disease progression, survival, and toxicity were derived from clinical trial data, while costs (in 2016 US dollars) and health utilities were estimated from the literature. Incremental cost-effectiveness ratios (ICERs), expressed as dollar per quality-adjusted life-year (QALY), were calculated with values less than $100,000/QALY considered cost-effective from a healthcare payer perspective. We conducted one-way and probabilistic sensitivity analyses to examine model uncertainty. Results: Our base-case model found that treatment with nivolumab increased overall cost by $59,000 and improved effectiveness by 0.2443 QALYs compared to single-agent therapy, leading to an ICER of $241,100/QALY. In sensitivity analyses, the model was most sensitive to the cost of nivolumab and assumptions about survival. Nivolumab would become cost-effective if the cost per cycle decreased from $13,432 to $5,716. If we assumed that all patients alive at the end of the Checkmate 141 trial were cured of their disease then nivolumab was still not considered cost-effective (ICER $160,000/QALY). Probabilistic sensitivity analysis also demonstrated relative stability of the cost-effectiveness model and found that treatment with nivolumab was cost-effective 0% of the time at a willingness-to-pay threshold of $100,000/QALY. Conclusions: While nivolumab significantly improves overall survival, at the current cost it would not be considered a cost-effective treatment option for patients with R/M SCCHN.