Bovine-leukosis virus (BLV; also termed 'bovine-leukemia virus') is a retrovirus that primarily affects lymphoid tissue of dairy and beef cattle. Our objective was to investigate the association between BLV infection and annual value of production (AVP) on dairy herds within the United States, as part of the USDA National Animal Health Monitoring System's 1996 dairy study. 1006 herds (in 20 states) with at least 30 dairy cows were interviewed during 1996. The agar-gel immunodiffusion test was used to detect serum antibodies to BLV. 10-40 cows from each herd were tested and each tested cow was classified as negative or positive based on results of a single test. A multivariable regression model was used with the 976 herds with complete data for analysis. When compared to herds with no test-positive cows, herds with test-positive cows produced 218 kg per cow (i.e. 3%) less milk. The average reduction in AVP was $59 per cow for test-positive herds relative to test-negative herds. For the dairy industry as a whole, BLV seropositivity was associated with loss to producers of $285 million and $240 million for consumers. Most of this $525 million industry loss was due to reduced milk production in test-positive herds.