The aim of this study was to estimate costs accrued by the health care of children with asthma in comparison to children with atopic eczema and seasonal rhinitis and to investigate cost determinants. From the multicenter cohort study (MAS-90), we selected children with an asthma, atopic eczema and/or seasonal rhinitis diagnosis during the first 8 years of life, and overall 8-year health care utilization was estimated retrospectively by reviewing medical records. Asthma treatment (n = 76) incurs an average cost of 627 US dollars per year, 44% due to hospital stays. Atopic eczema treatment (n = 91) cost on average 219 US dollars and seasonal rhinitis (n = 69) 57 US dollars per year. In asthma and atopic eczema, costs increase significantly with disease severity. Allergy diagnostics use accounts for only 1% of total costs. Costs for asthma and atopic eczema treatment are highest in those years when topical steroids are used for the first time, but decrease with every further year of steroid use. A remarkable 25% of asthmatic children with severe symptoms were not treated according to national guidelines, so that most steroid treatment was initiated during the first hospital stay. In the case of asthma, total direct costs increased until the 3rd year of the disease, and then decreased with further years of diagnosis, while steroid use continued to increase. These results indicate a 'learning effect' in the treatment of asthma and atopic eczema for each patient as well as considerable cost-saving potential by preventing severe asthma. Moreover, the importance of considering cost-driving factors and using cohort or longitudinal designs in cost-of-illness approaches is emphasized.