A study was carried out to analyze the factors associated with drug spending by the elderlypopulation in Belo Horizonte, Brazil. Data were obtained using a household survey of 667 community-dwelling persons aged 60 years or older conducted in 2003. A Tobit multivariate model was used to ana-lyze factors associated with pharmaceutical expenditures. Data from 590 respondents were used for theanalysis. The mean out-of-pocket pharmaceutical expenditure was US$ 38.91. Better sociodemographicconditions, worse health conditions and greater use of health services were associated with out-of-pocketpharmaceutical expenditures by elderly people in Belo Horizonte. The out-of-pocket pharmaceutical ex-penditures by elderly people were high considering their income level. The factors that influence spendingshould be considered in the formulation of pharmaceutical policies that improve the health conditions ofelderly people.