The use of adjuvant chemotherapy for postmenopausal patients with early breast cancer remains controversial because the potential benefits in terms of prolongation of disease-free survival (DFS) and overall survival (OS) must be balanced agains the toxicity of treatment. Following mastectomy, 463 evaluable postmenopausal women with node-positive breast cancer were randomized to receive either chemoendocrine therapy for 1 year, or endocrine therapy alone for 1 year, or no adjuvant therapy (Ludwig Trial III). At 7-years median follow-up, OS was longer for the chemoendocrine-treated patients compared with controls (P = .04) and compared with the adjuvant endocrine therapy-alone group (P = .08). In order to balance this therapeutic advantage against the toxic effects of treatment, OS time was divided into time with toxicity (TOX), time without symptoms and toxicity (TWiST), and time after systemic relapse (REL). TOX and REL were weighted by coefficients of utility relative to TWiST and the results added to give a period of quality-adjusted survival (Q-TWiST). Benefits measured by Q-TWiST generally favored chemoendocrine therapy. For example, if TOX and REL were both given utility coefficients of 0.5 relative to 1.0 for TWiST, then by 7 years the average Q-TWiST for chemoendocrine therapy was 6.7 months longer than for no-adjuvant therapy (P = .05) and 4.1 months longer than for endocrine therapy alone (P = .20). Quality-adjusted survival analysis is recommended in assessing costs and benefits of toxic adjuvant therapy. In this example, it supports the use of chemoendocrine therapy in postmenopausal node-positive patients for a wide range of relative values assigned to periods with symptoms and toxicity.