The objective of this study was to analyze the variables related to inappropriate admissions and hospital stays and their financial repercussions. This was a descriptive retrospective study in which the Appropriateness Evaluation Protocol (AEP) was applied to a representative sample of 725 hospital admissions and 1350 hospital stays. The cost of inappropriate stays was calculated by cost accounting. The study found that 7.4% of admissions and 24.6% of stays were inappropriate. Inappropriate admissions were significantly related to medical specialties and younger patient age. Inappropriate stays were related to these factors, plus patients being outside their corresponding areas, nonurgent admissions, and low occupancy rate. The cost of the inappropriate admissions and stays was 147 044 euros. Extrapolated to the hospital as a whole this would represent 2125638 euros per year. Steps must be taken to reduce inappropriate admissions and stays to lower health care costs and to reserve hospital resources for patients who genuinely need them.