Objectives People who inject drugs (PWID) are at high risk for acquiring hepatitis C virus (HCV), but many are unaware of their infection. HCV dried blood spot (DBS) testing increases case-finding in addiction services and prisons. We determine the cost-effectiveness of increasing HCV case-finding among PWID by offering DBS testing in specialist addiction services or prisons as compared to using venepuncture. Design Cost-utility analysis using a dynamic HCV transmission model among PWID, including: disease progression, diagnosis, treatment, injecting status, incarceration and addition services contact. Setting UK. Intervention DBS testing in specialist addiction services or prisons. Intervention impact was determined by a meta-analysis of primary data. Primary and secondary outcome measures Costs (in UK £, £1=US$1.60) and utilities (quality-adjusted life years, QALYs) were attached to each state and the incremental cost effectiveness ratio (ICER) determined. Multivariate uncertainty and one-way sensitivity analyses were performed. Results For a £20 000 per QALY gained willingness-to-pay threshold, DBS testing in addiction services is cost-effective (ICER of £14 600 per QALY gained). Under the base-case assumption of no continuity of treatment/care when exiting/entering prison, DBS testing in prisons is not cost-effective (ICER of £59 400 per QALY gained). Results are robust to changes in HCV prevalence; increasing PWID treatment rates to those for ex-PWID considerably reduces ICER (£4500 and £30 000 per QALY gained for addiction services and prison, respectively). If continuity of care is >40%, the prison DBS ICER falls below £20 000 per QALY gained. Conclusions Despite low PWID treatment rates, increasing case-finding can be cost-effective in specialist addiction services, and in prisons if continuity of treatment/care is ensured.