Respiratory syncitial virus (RSV) is the most common cause of lower respiratory tract infections (LRTI) in children worldwide and it is associated with significant childhood morbidity. Acute infection may result in respiratory failure with varying degrees of severity, and increasing evidence supports a role of RSV infection as a key determinant for the development of subsequent chronic respiratory disease. Independent predictors of RSV severity include; prematurity, congenital heart disease, cystic fibrosis, immune defects and neuromuscular disorders. Passive immunization with palivizumab has proven to be safe and effective for preventing RSV hospitalization in infants at higher risk of acquiring severe RSV infection, but its expense and cumbersome monthly intravenous delivery schedule make it inaccessible to many. Furthermore, implementing prophylaxis in 32- to 35-week-gestational age infants and the mode of its administration still represent areas of uncertainty. In this review, we describe several aspects of RSV infection and analyze recent advances in the assessment of cost-effective palivizumab prophylaxis.