OBJECTIVE: To improve the evidence base for health policy by devising a method to measure and monitor the performance of health systems. DESIGN: Estimation of the relation between levels of population health and the inputs used to produce health. SETTING: 191 countries. MAIN OUTCOME MEASURE: Health system efficiency (performance). RESULTS: Estimated efficiency varied from nearly fully efficient to nearly fully inefficient. Countries with a history of civil conflict or high prevalence of HIV and AIDS were less efficient. Performance increased with health expenditure per capita. CONCLUSIONS: Increasing the resources for health systems is critical to improving health in poor countries, but important gains can be made in most countries by using existing resources more efficiently.