Abstract Background The increasing incidence of pediatric inflammatory bowel disease (IBD), along with more extensive and severe disease in children, raises concern for related health care expenditures. Aim The aim of this study was to quantify and characterize costs of pediatric IBD in the year following diagnosis. Methods We identified all patients diagnosed with IBD at Connecticut Children’s Medical Center in 2016 with a minimum of 1 year follow-up. Clinical and demographic factors were recorded at diagnosis. We examined paid service and professional costs related to outpatient medications and infusions, outpatient procedures and radiology imaging, inpatient services, and outpatient visits. Actual dollar reimbursements were from private and public payers. Data is reported as mean ± SD and median (IQR). Results First-year cost data were collected on 67 patients (43 Crohn’s disease CD, 24 ulcerative colitis UC, mean age 13 years SD 3.22) revealing a mean cost of $45,753 (SD $37,938), with $43,095 (SD $30,828) for CD and $50,516 (SD $48,557) for UC. Severe CD (n = 11) had a mean cost of $71,176 (SD $43,817) and severe UC (n = 5) $134,178 (SD $40,920). Patients receiving infusion therapy had a mean cost of $59,376 (SD $38,724) compared with $27,903 (SD $28,795) for those not receiving infusions. Overall cost distribution showed 37% from infusion costs, 25% hospital costs, 18% outpatient procedures, 10% outpatient oral medications, 7% outpatient imaging, and 3% outpatient visits. Conclusions Infusion therapy is a key driver of first-year costs for children newly diagnosed with IBD. Understanding cost distribution in relation to disease presentation can be helpful to anticipate future related costs. Pediatric inflammatory bowel disease is increasing in incidence and severity, which raises concern for related health care expenditures. Severity of disease at time of diagnosis and use of biologic infusion therapy dramatically increase costs in the first year after diagnosis.