The relationship between pharmacy production environment and labor-time requirements was estimated by using data from Veterans Affairs medical center (VAMC) pharmacies. Economic theory was used to derive equations for estimating labor-time requirements for pharmacy services that take into account differences in production environment (factors that cannot be controlled by the pharmacy manager within a given observation period, such as pharmacy service mix and distance to patient care wards). The equations were estimated by using information obtained from the Department of Veterans Affairs (VA) and from a mail survey of VAMC pharmacy chiefs. The resulting estimates of labor-time requirements were compared with pharmacy labor-time requirements produced by the VA in 1989. Labor-time requirements varied dramatically with production environment, and the labor-time requirements calculated in this study generally exceeded those used by the VA. Accurate forecasts of required pharmacist and technician labor time must take into account the production environment within each pharmacy.