SummarySenegal is changing policy for case management of uncomplicated falciparum malaria, which hitherto is diagnosed clinically and treated with chloroquine or intramuscular quinine. The WHO recommends artemisinin‐based combinations for treating falciparum malaria, preferably based on a parasitological diagnosis. There are no economic projections if such a policy were introduced in Senegal. We have conducted a preliminary economic assessment of such a policy change. The study took place in the chloroquine‐resistant district of Oussouye in south‐western Senegal. We reviewed clinic registers of the district health posts (n = 5) from 1996 to 2001, and piloted artesunate combined with amodiaquine (at 4 and 10 mg/kg/day × 3 days respectively) (AS‐AQ) for treating slide‐proven falciparum malaria during two rainy seasons (2000 and 2001) at one health centre. These data were used to calculate current direct patient costs (clinic visit, diagnosis, drugs) of malaria treatment and project future costs for the district. The robustness of the model was tested by allowing for different drug failure rates and costs of diagnosis. During 1996–2001, the mean number of primary treatments per year was 7654 for a mean, direct cost of US$17 452 to the community. Clinical diagnosis resulted in over‐treatment: 56% and 66% in the wet and dry seasons respectively. Current policy leads to substantial drug wastage and excess direct costs for the community. The direct costs of implementing AS‐AQ for slide‐proven malaria would be US$8150 (53% less expensive). Studies examining the public health effect and economics of deploying AS‐AQ on a wider scale are underway in Senegal.