Recurrent fluctuations in health states can occur as a result of long-term conditions with episodic symptoms or through side effects of cycles of treatment. Fluctuations and associated duration of symptoms can be predictable (eg, side effects of chemotherapy treatment) or unpredictable (eg, relapse in multiple sclerosis). Such recurrent fluctuations in health states can have an important impact on a person's health-related quality of life. When symptoms vary by time of day, day of the week, or during the month, it is challenging to obtain reliable health-related quality of life estimates for use in assessing cost-effectiveness of interventions. The adequacy of the quality of life estimate will be affected by (1) the standard recall period associated with the chosen measure (eg, "health today" EQ-5D, "past 4 weeks" for SF-36/SF-6D) and the way that respondents understand and make judgments about these recall periods, (2) the chosen time points for assessing health-related quality of life in relation to the fluctuations in health, and (3) the assumptions used to interpolate between measurement time points and thus calculate the quality-adjusted life-years. These issues have not received sufficient methodological attention and instead remain poorly accounted for in economic analyses. There is potential for these issues to considerably distort treatment decisions away from the optimal allocation. This article brings together evidence from health economics, psychology, and behavioral economics to explore these challenges in depth; presents the solutions that have been applied to date; and details a methodological research agenda for measuring quality-adjusted life-years in recurrent fluctuating health states.