A new cost-based control strategy is presented that optimizes engine-aftertreatment performance under all operating conditions. This Integrated Emission Management strategy minimizes fuel consumption within the set emission limits by on-line adjustment of air management based on the actual state of the exhaust gas aftertreatment system. Following a model-based approach, Integrated Emission Management offers a framework for future control strategy development. This approach alleviates calibration complexity, since it allows to make optimal trade-offs in an operational cost sense.The potential of the presented cost-optimal control strategy is demonstrated for a modern heavy-duty Euro VI engine. The studied diesel engine is equipped with cooled EGR, Variable Geometry Turbocharger, and a DPF-SCR aftertreatment system. A simulation study shows that the proposed Integrated Emission Management strategy accomplishes 2% to 3% reduction in fuel consumption and operating costs compared to a baseline strategy. Further potential benefits include reduced heat rejection associated with the EGR system and reduced DPF regeneration frequency.