To determine the epidemiology and costs of hospitalization with primary varicella and herpes zoster in the prevaccine era and the usefulness of hospital discharge data to determine the population impact of vaccination on these conditions, statewide hospital discharge data in Connecticut from 1986 to 1995 were analyzed. Annual hospitalizations for herpes zoster were 4-fold higher than for primary varicella (16.1 vs. 4.1/100,000). Overall, 69% and 83%, respectively, had no underlying immunosuppressive conditions. Regarding primary varicella, 53% of patients were aged <15 years, there was a marked winter-spring seasonality, and Hispanics and blacks were 4.1 and 2.6 times more likely than whites to be hospitalized. Regarding herpes zoster, 66.9% of patients were aged >64 years, and there was no seasonality. The mean patient charges in 1995 were $12,819 for primary varicella and $15,583 for herpes zoster. Analysis of population-based hospital discharge data is a feasible means of monitoring the impact of varicella immunization on severe morbidity due to primary varicella and herpes zoster.