This study estimated the impact of the dust pollution on workers‟ health and cost of illness in the textile industry of the Faisalabad. The cost of illness is the sum of the workday cost and cost of the medication. This was the cross sectional study conducted among the 200 randomly selected textile workers. This study estimated the both health and opportunity cost of textile workers by using the structural equation model (SEM) with observed and latent variables. Study used the confirmatory factor analysis (CFA) to interlink the latent factor diseases with their indicators symptoms. The results of the SEM model on age, respiratory diseases, overtime work, duration of employment, use of masks, and dust level are significant. Study finds that 62% workers beard the cost of illness and 43% workers miss the work last two weeks. The 69 % workers reported that due to the illness their work performance in industry is not normal, they suffered the problems during the work such as muscle aches, asthma, cough, respiratory allergy etc. Study also measured the prevalence of the respiratory diseases among the textile workers. Study revealed that 35.5% workers had wheezing, 65.5% phlegm, 58% chest tightness, 72% had a throat irritation problems. Study concluded that there is a high prevalence of respiratory diseases among the textile workers due to the exposure of dust pollution. Study also concluded that if successfully reduction in dust pollution occurs in textile industry; the worker will gained the benefits in term of the reduction in medical cost and gain in terms of wages. Supervisor:- Dr. Usman Mustafa