Insects and mites cost cotton producers $645 million a year in yield losses and control costs (direct damage) during 1981-84, over half of which went for chemical controls. Bollworms and tobacco budworms caused the most ($216 million) in direct damage. But the total economic cost of cotton insects and mites may approach $1.3 billion after considering changes in cotton production, prices, processing, and use of other commodities. Extensive chemical use to control insects and mites potentially adds to the cost because, if not properly applied, the treatments may harm farmworkers and the environment. This report uses expert opinions and a model that simulates the absence of direct damage to estimate cotton yield losses, control costs, and the potential hazards of chemically controlling these cotton pests.