This study uses Data Envelopment Analysis to examine public sector hospital efficiency in 80 provincial markets in Turkey. Outputs of the study includes mortality rate as quality measure as well as inpatient discharges and outpatient visits. Patient beds, four levels of health labor, and expenditures are used to capture capital, labor and material resources as inputs. Results show that 55% of the public hospitals in served markets are operated inefficiently. Analysis of inefficient provinces suggests that in those 44 inefficient provinces are collectively overbedded, employ excessive number of specialists and other health labor. They spent approximately $70,000,000 from their revolving funds in excess compared to efficient provinces.