Objective: To assess the cost-effectiveness of vaginal misoprostol (PGE1) (25μg) compared to a slow-release dinoprostone (PGE2) pessary (10μg) for labor induction due to an unfavorable cervix at term. Methods: We used data from an open-label multicenter, randomized noninferiority trial which recruited women for whom labor was induced for medical reasons, a Bishop score ≤ 5 at ≥ 36 weeks, and a cephalic-presenting singleton pregnancy with no prior cesarean delivery. The Incremental Cost Effectiveness Ratio (ICER) was assessed from the payer’s perspective, with the focus on inpatient care costs and using the Caesarean Deliveries Avoided (CDA) rate as primary analysis and the rate of Vaginal Delivery within 24h (VD24) as secondary analysis. Results: Analyses were based on 790 women in each group. Differences between treatment arms were the mean cost per patient of €4,410 and €4,399, a CDA rate of 80.1% and 77.9% and a VD24 rate of 46.1% and 59.4% for dinoprostone and misoprostol respectively. Dinoprostone is not cost-effective according to the CDA and misoprostol was either a cost-effective or a dominant strategy according to the VD24. Conclusion: Misoprostol and dinoprostone have equal cost management with mixed efficacy according to the clinical outcome used. Finally, misoprostol may be an attractive option for hospitals since the price is lower and it is easier to use.