The operation of the radiology department and hospital was analyzed prior to and after the installation of a hospital-wide picture archiving and communication system (PACS). Significant improvements in radiologist productivity, timeliness of imaging reports, and film retake and film loss rates were recorded. Preliminary economic analysis suggests that capital depreciation and maintenance costs are matched by savings in film costs and personnel. The use of the PACS may also increase the efficiency of clinicians and other hospital staff which could result in substantial savings on a hospital-wide basis. Further savings may be achieved by sharing the PACS among multiple medical centers. Clinicians expressed a preference for PACS over film, typically utilized the system 3-5 times per day, taught themselves how to use the PACS rather than take the formal training course, and indicated that their rate of consultations with radiologists had not changed or that it had decreased after the transition to filmless radiology.