Osteoporosis-related hip fracture is an important cause of mortality and morbidity in older people. In an aging society such as Japan's, prevention and treatment of osteoporosis is of paramount importance in reducing the risk of hip fracture. To determine the efficiency of screening by dual-energy X-ray absorptiometry for reducing the incidence of hip fracture, a cost-effectiveness analysis was conducted using a state-transition model. We compared the following four strategies in a hypothetical cohort of postmenopausal Japanese women: (1) no intervention; (2) hormone replacement therapy (HRT) for patients with osteoporosis after screening; (3) HRT for patients with osteopenia and osteoporosis after screening; and (4) universal HRT. Epidemiological and economic data were collected from published articles. HRT for patients with osteoporosis after screening was the most cost-effective strategy, with the marginal cost-effectiveness being 5.36 million yen/quality-adjusted life year (QALY). The ratios for other strategies exceeded 10 million yen/QALY. Sensitivity analyses showed that the drug effect and treatment cost of HRT had a significant influence on the results. Screening postmenopausal Japanese women and treating patients with osteoporosis may be an acceptable strategy, but its cost-effectiveness ratio seems only fair at present.