The employ of thermal insulation is one of the most effective ways of building energy conservation for cooling and heating. Therefore, the selection of a proper insulation material and the determination of optimum insulation thickness are particularly vital. Four typical cities of Shanghai, Changsha, Shaoguan and Chengdu are selected to represent A, B, C and D subzone of hot summer and cold winter zone in China, respectively. The Optimum thicknesses of five insulation materials including expanded polystyrene, extruded polystyrene, foamed polyurethane, perlite and foamed polyvinyl chloride are Calculated with a typical residential wall using solar-air cooling and heating degree-days analysis and P(1)-P(2) economic model. And then, life cycle total costs, life cycle savings and payback periods are calculated based on life cycle cost analysis. Considering different orientations, surface colors, insulation materials and climates, optimum thicknesses of the five insulations vary from 0.053 to 0.236 m, and the payback periods vary from 1.9 to 4.7 years over a lifetime of 20 years. The maximum life cycle savings are 54.4 $/m(2) in Shanghai, 54.8 $/m(2) in Changsha and 41.5 $/m(2) in Shaoguan (with a deep-colored northeast wall), and 39.0 $/m(2) in Chengdu (with a light-colored northwest wall). Finally, an approach to analyze economical efficiency of insulation materials is developed, result shows that expanded polystyrene is the most economic insulation material of the five because of the highest life cycle saving and lowest payback period. (c) 2009 Elsevier Ltd. All rights reserved.