Background: Engaging patients in a group-based weight loss program is a challenge for the acute-care hospital outpatient setting. Aim: To evaluate a telephone-based weight loss service as an alternative to an existing face-to-face, group-based service in terms of reach, effectiveness and cost-effectiveness. Methods: Two-group pre-post design feasibility study. Patients who declined a 2-month group-based program were offered a 6-month telephone program. Outcomes (primary effectiveness outcome = objectively measured weight) were assessed at baseline, 2-months, and 6-months (telephone only). Changes within the telephone program were analysed by paired t-tests. Differences between the programs at 2-months were compared with linear regression models, adjusting for baseline values and confounders. The cost per healthy life year gained was calculated for both programs. Results: Fifty patients (19% of referrals) commenced the group-based program (60% female, 57.4 ± 13.5 years [mean ± SD]), with 66% completion at 2-months. Sixty-one patients (44% of eligible) commenced the telephone program (46% female; 49.3 ± 12.0 years), with 57% completion at 6-months. The telephone program achieved significant weight loss (-4.1 ± 5.0% body weight, p<0.05) at 6-months. Compared to the group-based program, the telephone program was associated with greater weight loss (mean difference [95%CI]: -2.0 [-3.4,-0.6] % body weight change; p=0.007) at 2-months. The cost per healthy life year gained was $33,000 and $85,000, for the telephone and group-based programs, respectively. Conclusions: The telephone-delivered weight management service was cost-effective, more effective for weight loss than usual (group-based) care, and reached participants who declined usual care. Exploring such alternative and broad-reaching service delivery models is important for the significant proportion of patients who remain unengaged with existing weight management services.