Globally, tobacco consumption continues to cause a huge burden of preventable diseases. Nigeria has been leading tobacco markets in Africa and the absolute number of active smokers remains one of the highest on the continent. Yet, little is known on the economic costs of cigarette smoking in Nigeria which prevents an effective policy response. This study seeks to address this gap by estimating the economic costs of tobacco use across different groups as well as the cost-effectiveness of tobacco tax interventions. The study consists of three separate undertakings that taken together, provide personal anecdotal evidence of the detrimental effects that tobacco consumption has in Nigeria; estimate the direct cost associated with tobacco-related diseases; and use an innovative methodology to estimate the indirect costs of tobacco-related illnesses, which were previously unavailable in the country.