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Dexmedetomidine utilisation in paediatric patients is increasing. We hypothesised that intraoperative use of dexmedetomidine in children is associated with longer postanaesthesia care unit length of stay, higher healthcare costs, and side-effects. We analysed data from paediatric patients (aged 0–12 yr) between 2016 and 2021 in the Bronx, NY, USA. We matched our cohort with the Healthcare Cost and Utilization Project-Kids' Inpatient Database (HCUP-KID). Among 18 104 paediatric patients, intraoperative dexmedetomidine utilisation increased from 51.7% to 85.7% between 2016 and 2021 (P <0.001). Dexmedetomidine was dose-dependently associated with a longer postanaesthesia care unit length of stay (adjusted absolute difference [AD adj ] 19.7 min; 95% confidence interval [CI]: 18.0–21.4 min; P <0.001, median length of stay of 122 vs 98 min). The association was magnified in children aged ≤2 yr undergoing short (≤60 min) ambulatory procedures (AD adj 33.3 min; 95% CI: 26.3–40.7 min; P <0.001; P -for-interaction <0.001). Dexmedetomidine was associated with higher total hospital costs of USD 1311 (95% CI: USD 835–1800), higher odds of intraoperative mean arterial blood pressure below 55 mm Hg (adjusted odds ratio [OR adj ] 1.27; 95% CI: 1.16–1.39; P <0.001), and higher odds of heart rate below 100 beats min−1 (OR adj 1.32; 95% CI: 1.21–1.45; P <0.001), with no preventive effects on emergence delirium requiring postanaesthesia i.v. sedatives (OR adj 1.67; 95% CI: 1.04–2.68; P =0.034). Intraoperative use of dexmedetomidine is associated with unwarranted haemodynamic effects, longer postanaesthesia care unit length of stay, and higher costs, without preventive effects on emergence delirium. [ABSTRACT FROM AUTHOR]