Background: Tuberculosis is one of the most devastating infectious diseases worldwide. It constitutes a major global health problem infecting millions of people each year, with a particular heavier burden on the developing world. Objective: evaluating the cost effectiveness of incorporating Gene Xpert to sputum microscopy compared to sputum microscopy and culture for diagnosis of tuberculosis and multidrug-resistant (MDR) tuberculosis in low- to middle-prevalence settings like Egypt. Design: An economic evaluation study was conducted using a decision analysis model representing the diagnostic process starting with tuberculosis suspects, continuing to tuberculosis cases, and ending with treatment. The model outcome was the incremental cost per incremental DALYs (Disability Adjusted Live Years) averted between the new GX algorithms incorporated with smear microscopy versus the standard algorithm for detection of suspect TB case. Results: Xpert testing is estimated to result in additional costs (EGP 2,320) per each DALY averted compared to sputum microscopy and culture. Conclusion: The results of this study advocate that GXpert is a cost-effective method of TB diagnosis, compared to a base case of smear microscopy and clinical diagnosis with its ability to substantial increase in case finding. It has also important potential for improving tuberculosis diagnosis and disease control.