Background Intraoperative frozen section (FS) often is performed in patients who undergo thyroid lobectomy to determine the need for completion thyroidectomy. At our institution, if FS pathology is benign, final pathology is expedited overnight. The aim of this study was to determine the utility of FS and to identify a cost-effective management algorithm for thyroid lobectomy. Methods A retrospective review was performed of patients who underwent thyroid lobectomy between January 2009 and May 2013. Preoperative cytology ranged from “benign” to “suspicious for malignancy.” Clinically significant cancers were defined as >1 cm in size, or multifocal microcarcinomas. Results Of the 192 patients who underwent thyroid lobectomy with FS, FS was suspicious for malignancy in 5 (3%) patients; 1 (0.5%) underwent immediate completion thyroidectomy. On final pathology, 9 (5%) patients had clinically significant cancers and underwent completion thyroidectomy. FS had a sensitivity and positive predictive value of 22% and 40%, respectively, in identifying clinically significant thyroid cancer. Cost of thyroid lobectomy at varying rates of same-day discharge favored thyroid lobectomy without FS but with expedited pathology for all scenarios. Conclusion At our institution, there appears to be limited utility of FS at the time of thyroid lobectomy given the low predictive value for diagnosing a clinically significant thyroid cancer. In patients who are admitted overnight, expedited pathology is slightly less costly and may improve patient quality-of-life and decrease costs by avoiding delayed completion thyroidectomy. Overnight pathology for patients who undergo thyroid lobectomy may achieve modest cost-savings depending on institutional FS results and rates of malignancy.