Incompatible living donor kidney transplantation (ILDKT) has been established as an effective option for end-stage renal disease patients with willing but HLA-incompatible living donors, reducing mortality and improving quality of life. Depending on antibody titer, ILDKT can require highly resource-intensive procedures, including intravenous immunoglobulin, plasma exchange, and/or cell-depleting antibody treatment, as well as protocol biopsies and donor-specific antibody testing. This study sought to compare the cost and Medicare reimbursement, exclusive of organ acquisition payment, for ILDKT (n = 926) with varying antibody titers to matched compatible transplants (n = 2762) performed between 2002 and 2011. Data were assembled from a national cohort study of ILDKT and a unique data set linking hospital cost accounting data and Medicare claims. ILDKT was more expensive than matched compatible transplantation, ranging from 20% higher adjusted costs for positive on Luminex assay but negative flow cytometric crossmatch, 26% higher for positive flow cytometric crossmatch but negative cytotoxic crossmatch, and 39% higher for positive cytotoxic crossmatch (p < 0.0001 for all). ILDKT was associated with longer median length of stay (12.9 vs. 7.8 days), higher Medicare payments ($91 330 vs. $63 782 p < 0.0001), and greater outlier payments. In conclusion, ILDKT increases the cost of and payments for kidney transplantation.