Objective To investigate the association between physical activity volume and medical care cost in elderly persons aged 70 years and over in Crane Valley, Sendal, Japan. Methods A total of 494 community-dwelling Japanese elderly persons living in residential area of Sendai City in northern Japan completed a self-administered questionnaire that included questions on physical activity. We ascertained total medical care costs through computerized linkage with claims lodged between November 2002 and December 2004 from the Miyagi National Health Insurance Association.Results After multivariate adjustment for potential confounders, the average monthly medical costs of hospitalization, hospital days, outpatient medical expenses, out-patient numbers and the total medical expenses in grade Ⅰ exercise volume group were (196.7±72.1) U.S. dollars, (0. 7±0.3) d, (308. 7±54.4) U.S. dollars, (6.2±1.1) times and (506. 95±94. 2) U.S. dollars; in grade Ⅱ exercise volume group were (139. 8±72.1) U.S. dollars, (0.5±0. 3) d, (295.3±54.6) U.S.dollars, (6.1±1.1) times and (437.8±94.5) U.S. dollars; in grade Ⅲ exercise volume group were (134.1±72.5) U.S. dollars, (0.4±0.3) d, (278.8±54.9) U.S. dollars, (5.8±1.1) times and (418. 1±95.0) U.S. dollars. With the increase in physical activity, there were significant differences between the medical costs of hospitalization and total medical expenses (F=5.85 and 8.11, both P=0.01). Conclusions This prospective study indicates that a higher volume of physical activity is associated with lower medical care costs among Japanese elderly persons.