Background: Treatment guidelines for muscle-invasive bladder cancer recommend radical cystectomy. However, use of trimodal therapy has increased in recent years with conflicting survival outcomes. The aim of this study was to compare radical cystectomy and trimodal therapy in terms of survival outcomes and cost of treatment according to varying statistical methodology in order to interpret findings using observational data. Methods: Patients aged 66 years or older diagnosed with clinical stage T2-4a bladder cancer from January 1, 2002-December 31, 2011 were included from the Surveillance, Epidemiology, and End Results (SEER)-Medicare database. Outcomes included cancer-specific survival, overall survival, and 6-month costs. Cox proportional hazards regression, propensity score matching (PSM) and inverse probability of treatment weighting (IPTW) were used to control for baseline differences between patients undergoing radical cystectomy vs. trimodal therapy, and to determine predictors for overall and cancer-specific survival. Results: A total of 2,963 patients were included: 728 (24.6%) who underwent trimodal therapy were compared to 2,235 (75.4%) who underwent radical cystectomy. In all adjusted analyses, patients who underwent trimodal therapy had significantly decreased cancer-specific survival (Cox regression: Hazard Ratio (HR) 1.51, 95% Confidence Interval (CI) 1.40-1.63; PSM: HR 1.55, 95% CI 1.32-1.83; IPTW: HR 1.51, 95% CI 1.40-1.63) and overall survival (Cox regression: HR 1.54, 95% CI 1.39-1.71; PSM: HR 1.49, 95% CI 1.31-1.69; IPTW: HR 1.54, 95% CI 1.39-1.71). However, median total costs over six months were significantly higher with trimodal therapy than radical cystectomy ($171,401 vs. $99,890, p<0.001). Conclusions: Trimodal therapy was associated with decreased cancer-specific and overall survival at increased costs compared to radical cystectomy. In the absence of data from randomized controlled trials, this observational study provides further evidence to suggest the superiority of radical cystectomy over trimodal therapy in patients with muscle-invasive bladder cancer.