Bovine mastitis reduces the yield and quality of milk and increases the rate of culling and veterinary costs. This reduces the profitability of farm milk production but the calculation of the extent of this economic loss is complex because of the many factors involved and deficiencies in the evidence on the relationship between the disease and various production factors. This paper examines the available evidence for the UK and provides a consistent analytical framework within which the benefits arising from reduced mastitis in dairy herds constrained by quota can be considered. It is estimated that since 1970 the farms that have followed the recommended control procedures have reduced the average annual number of cases of clinical mastitis from 135 to 40 cases/100 cows each year, while the quarters remaining uninfected for a whole year has increased from 65 to 80% of the total quarters. The costs of the main control procedures (e.g. £8–60/cow for dry-cow therapy and teat dipping or spraying) are broadly covered by the reduction in clinical mastitis, leaving the benefits of reduced subclinical infection (e.g. £3810 for a 100 cow herd unconstrained by quota and achieving the average reduction in infection) as a substantial bonus. The imposition of quotas reduces the financial benefit of mastitis control but it still remains a worthwhile investment. The results of this analysis can be used to suggest maximum costs of additional new control measures produced by research. It also indicates that there is considerable value in production research which gives more precise knowledge of production Systems, thus allowing producers to respond optimally to quota cuts.