The objective of the study was to estimate the lameness induced total and avoidable financial losses in modern dairy herds. For this purpose, a prospective longitudinal observation study was carried out in 87 randomly selected dairy herds from 1684 Turkish Dairy Breeding Association (TDBA) herds in Burdur, Konya and Kirklareli provinces between October 2003 and September 2004. The incidence rate of lameness in Burdur, Kirklareli and Konya provinces and weighted average of all were 13.7%; 13.4%, 5.6% and 10.2% respectively. The target incidence rate was calculated to be 6.6%. Financial losses from each cases of lameness were estimated as 271TL/case for mild cases (interdigital dermatitis), 343TL/case for intermediate cases (digital diseases), 509TL/case for the severe cases (sole ulcer) and 382TL/case for the weighted mean of all the disease forms. The mean financial loss for the average dairy enterprise was estimated to be 865TL of which 589TL (68%) was the avoidable losses. The study concluded that lameness causes severe financial losses in dairy herds. However, majority of these losses can be avoided by the dairy farmers.