Background: Despite early promising results, IMvigor211 failed to demonstrate an overall survival benefit for atezolizumab, compared to chemotherapy, in the second-line treatment of metastatic urothelial carcinoma. However, given improvements in adverse events (AE) and quality of life with atezolizumab, there may still be investment value. We conducted a cost-utility analysis (CUA) of atezolizumab compared to chemotherapy from a public-payer healthcare perspective. Methods: We developed a partitioned survival model to evaluate atezolizumab versus chemotherapy (i.e. docetaxel, paclitaxel or vinflunine). IMvigor211 informed rates of treatment receipt (initial and subsequent), AE, effectiveness and utility estimates. Cost for treatment, AE and death were based on published literature (adjusted to 2018 Canadian dollars). Per health state, cost of treatment (initial and subsequent) and AE were incorporated. Outcomes included quality-adjusted life-years (QALY), cost per treatment, and incremental cost-effectiveness ratio (ICER). QALY and cost were discounted at 1.5% (Canadian guidelines). Parameter uncertainty was assessed through one-way and scenario analyses. Time horizons of 2 (within trial) and 5 years (extrapolated lifetime) were evaluated. Results: QALY of atezolizumab and chemotherapy over 2 years (lifetime) were 0.65 (0.93) and 0.58 (0.64), respectively. Cost of atezolizumab and chemotherapy over 2 years (lifetime) was $77,614.64, ($92,484.34), and $62,212.35 ($67,606.65), respectively. ICER over 2 years and lifetime was $220,032.71/QALY and $85,785.14/QALY. Scenario analysis from a North American perspective with only taxane chemotherapy with and without third line immunotherapy (IO) revealed an ICER of $80,144.90/QALY, $125,332.76/QALY over a lifetime horizon, respectively. Conclusions: The difference in ICER dependent on time horizon, driven by extrapolated survival benefits, highlights the importance of long-term follow-up to examine whether early evidence for durable response translates into long-term survival and improvements in cost-effectiveness. Thus, CUA of IO require careful interpretation and warrant dynamic assessment as new data becomes available.