This cost-of-illness analysis based on information from 1.549 patients in The Netherlands is part of a Europe-wide study on the costs of multiple sclerosis (MS). The objective was to analyze the costs and quality of life (QOL) related to the level of disease severity and progression. Patients from three specialized MS centres participated in the survey by answering a mail questionnaire (response rate, 52%). In addition to details on the disease (type of disease, relapses, level of functional disability), the questionnaire asked for information on all resource consumption, medical, non-medical, work absence, early retirement and informal care as well as QOL (expressed as utility). The mean age of the cohort was 47 years, and 7.6% of patients were 65 years of age or more. Forty-eight percent of patients had mild disease [Expanded Disability Status Scale (EDSS) score of 0–3], 40% moderate disease (EDSS score of 4–6.5) and 11% severe disease (EDSS score of 7 and above). The mean EDSS score in the sample was 3.9 (median 4.0), with a utility of 0.61. Costs and utility are highly correlated with disease severity. Workforce participation decreases from around 75 to 80% in early disease to less than 5% in the very late stages. Hospitalization is very infrequent in early disease, representing less than € 500 per year for patients at EDSS scores below 6, but increases steeply for patients at an EDSS score of 7 and above. Ambulatory care increases fivefold between early and late disease, while services rise from basically no cost to almost € 8.000 per year at an EDSS score of 7 and € 19.000 per year at EDSS scores of 8–9. Productivity losses are multiplied by 10 in late disease, while informal care increases from € 300 per year at EDSS scores of 0–1 to nearly € 15.000 per year at EDSS scores of 8–9. Hence, total mean costs per patient are driven essentially by the distribution of the severity levels in the sample, increasing from € 9.300 per year at EDSS scores of 0–1 to € 50.000 per year at an EDSS score of 7 and € 78.000 per year at EDSS scores of 8–9. The same is true for utility, which decreases from 0.85 to 0.05 as the disease becomes severe. However, the utility loss compared to the age- and gender-matched general population is high at all levels of the disease (0.25 at an EDSS score of 2 to 0.4 at EDSS scores of 5–6), leading to an estimated annual loss of 0.24 quality-adjusted life-years (QALYs) per patient. Relapses for patients with an EDSS score below 5 are associated with a cost of around € 2.800 and a utility loss of 0.15 during the quarter in which they occur.