Health system expenditure is a global concern, with hospital cost a major component. Built environment has been found to affect physical activity and health outcomes. The purpose of the study was a first assessment of the relationship between neighborhood walkability and hospital treatment costs. For 88 neighborhoods in the Australian Capital Territory (ACT), 2011–2013, a total of 30,690 public hospital admissions for the treatment of four diagnostic groups (cancers, endocrine, nutritional and metabolic diseases, circulatory diseases and respiratory diseases) were extracted from the ACT admitted patient care database and analyzed in relation to the Walk Score® index as a measure of walkability. Hospital cost was calculated according to the cost weight of the diagnosis related group assigned to each admission. Linear regressions were used to analyze the associations of walkability with hospital cost per person, admissions per person and cost per admission at the neighborhood level. An inverse association with neighborhood walkability was found for cost per person and admissions per person, but not cost per admission. After adjusting for age, sex and socioeconomic status, a 20-unit increase in walkability was associated with 12.1% (95% CI: 7.1–17.0%) lower cost and 12.5% (8.1–17.0%) fewer admissions. These associations did not vary by neighborhood socioeconomic status. This exploratory analysis suggests the potential for improved population health and reduced hospital cost with greater neighborhood walkability. Further research should replicate the analysis with data from other urban settings, and focus on the behavioral mechanisms underlying the inverse walkability-hospital cost association.