Although treatment for the dialysis population is resource intensive, a cost-effectiveness analysis comparing hemodialysis (HD) and peritoneal dialysis (PD) by matched pairs is still lacking. After matching for clinical characteristics and propensity scores, we identified 4,285 pairs of incident HD and PD patients from a Taiwanese national cohort during 1998–2010. Survival and healthcare expenditure were calculated by data of 14-year follow-up and subsequently extrapolated to lifetime estimates under the assumption of constant excess hazard. We performed a cross-sectional EQ–5D survey on 179 matched pairs of prevalent HD and PD patients of varying dialysis vintages from 12 dialysis units. The product of survival probability and the mean utility value at each time point (dialysis vintage) were summed up throughout lifetime to obtain the quality-adjusted life expectancy (QALE). The results revealed the estimated life expectancy between HD and PD were nearly equal (19.11 versus 19.08 years). The QALE’s were also similar, whereas average lifetime healthcare costs were higher in HD than PD (237,795 versus 204,442 USD) and the cost-effectiveness ratios for PD and HD were 13,681 and 16,643 USD per quality-adjusted life year, respectively. In conclusion, PD is more cost-effective than HD, of which the major determinants were the costs for the dialysis modality and its associated complications.