Restriction of shop opening hours is current, but controversial, practice in Britain and most other European countries. The economic case commonly presented for such restrictions is that, given the constraint that individual shops may not vary their price by time of day, competitive pressures would induce excessive opening at times when high costs would be incurred, such as on Sundays. The paper shows that inefficient equilibria of this type are indeed a theoretical possibility. Empirical evidence on costs and demand in the UK shows, however, that this case does not in practice arise and that deregulation of opening hours would lead to lower costs and prices in the retail sector.