OBJECTIVES/HYPOTHESIS The ideal timing of tracheostomy varies. This study sought to determine demographic, management, and outcome differences in patients undergoing early tracheostomy (ET) versus late tracheostomy (LT) (<10 days vs. >10 days postintubation, respectively). STUDY DESIGN Retrospective review of the 2008 to 2010 Nationwide Inpatient Sample for patients with extreme severity of illness who underwent tracheostomy. METHODS Patients were subdivided based on the timing of tracheostomy placement (days 1-5, 6-10, 11-15, 16-20, 21-25). ET and LT were defined using a 10-day cutoff. Descriptive statistics were obtained for hospital and patient demographics. Multivariate models analyzed the effect of tracheostomy timing on primary outcomes of in-hospital morbidity/mortality, length of stay (LOS), and charges. RESULTS A total of 124,990 tracheostomy cases met inclusion criteria. Of the total cases, 53,749 underwent ET, and 71,244 underwent LT. Significant predictors (P < .01) of ET included patient age <65 years (odds ratio [OR]: 1.136), admission to a Midwest hospital (OR: 1.430), neurologic disorder (OR: 1.196), paralysis (OR: 1.264), and admission to a government, nonfederal hospital (OR: 1.434). Significant predictors of LT included admission to a small hospital (OR: 1.150), acute respiratory failure (OR: 1.601), and acute chronic respiratory failure (OR: 1.349). The economic outcomes of hospital costs and LOS increased linearly and significantly with time to tracheostomy, as did mortality (P < .001). ET was associated with a significantly increased rate of discharge to home (P < .001) and decreased rate of sepsis (P < .001) and ventilator-associated pneumonia (P < .001). CONCLUSIONS Efficient and effective healthcare delivery is paramount in today's economic climate. Identification of patients likely to need prolonged ventilator support and ET may prove to be a cost- and morbidity-saving measure and deserves further prospective examination.