The purpose of this retrospective cohort study was to explore the safety and cost-effectiveness of conservatively managed premature rupture of the membranes (PROM) in term and near-term pregnancy. The records of 909 women with PROM at or near term were reviewed. Outcomes of those women and infants who were managed conservatively were compared with those who were managed aggressively. Those who were managed conservatively experienced one-third the rate of cesarean sections, with no increase in intrauterine or neonatal infections, and were hospitalized a half-day longer than those managed aggressively. These findings are consistent with previously published studies and support the position that conservative management can be safe for both mother and infant. The findings also confirm that, with minor adjustments in institutional protocols, conservative management can be cost-effective.