Metachromatic leukodystrophy (MLD) is a fatal inherited lysosomal storage disease that can be detected through newborn bloodspot screening. The feasibility of the screening assay and the clinical rationale for screening for MLD have been previously demonstrated, so the aim of this study is to determine whether the addition of screening for MLD to the routine newborn screening program in the UK is a cost-effective use of National Health Service (NHS) resources. A health economic analysis from the perspective of the NHS and Personal Social Services was developed based on a decision-tree framework for each MLD subtype using long-term outcomes derived from a previously presented partitioned survival and Markov economic model. Modelling inputs for parameters related to epidemiology, test characteristics, screening and treatment costs were based on data from three major UK specialist MLD hospitals, structured expert opinion and published literature. Lifetime costs and quality-adjusted life years (QALYs) were discounted at 1.5% to account for time preference. Uncertainty associated with the parameter inputs was explored using sensitivity analyses. This health economic analysis demonstrates that newborn screening for MLD is a cost-effective use of NHS resources using a willingness-to-pay threshold appropriate to the severity of the disease; and supports the inclusion of MLD into the routine newborn screening programme in the UK.