Objective: The objective of this study was to assess the health and economic benefits of influenza vaccination in both healthy and at-risk seniors aged 65 to 74 years. Design and setting: We used administrative claims data from 6 consecutive serial cohorts spanning the years 1990 to 1991 through 1995 to 1996. All members of a Twin-Cities managed care organisation who were ≥65 years of age for the respective study year were included in each cohort. Other information obtained included demographic characteristics, baseline comorbidities, prior resource utilisation, and influenza vaccination status. Study outcomes included hospitalisations for pneumonia and influenza and for all respiratory conditions and death. Economic analyses assumed the societal perspective and included both direct and indirect costs. Main outcome measures and results: During the 6 study seasons, there were 100 195 person-periods of observation for persons aged 65 to 74 years. Of these, two- thirds were healthy and one-third had at least one major baseline comorbidity. Influenza vaccination was associated with reductions in hospitalisations for pneumonia and influenza and for all respiratory conditions in both healthy and at-risk groups, although the results did not reach statistical significance among the healthy individuals. Vaccination was also associated with significant reductions in the risk of death for both groups. The economic analysis demonstrated that vaccination against influenza in the base case was associated with direct and total cost savings for both healthy and at-risk seniors aged 65 to 74 years. Conclusion: Influenza vaccination of healthy and at-risk seniors aged 65 to 74 years is associated with substantial health benefits and is cost saving. These findings support age-based vaccination strategies for all persons ≥65 years of age.