This English expression is used very commonly in spoken language usually in the context of “to cost an arm and a leg.”
The idiom is used to denote that something is very very expensive. This meaning can also be denoted through the use of several other expressions such as “to cost a bomb” or “to cost the earth” although in general “to cost an arm and a leg” is the most commonly used of these.
The expression is a fairly modern one and the first written evidence of its usage can be dated to the year 1949 in The Long Beach Independent which reads “Food Editor Beulah Karney has more than 10 ideas for the homemaker who wants to say “Merry Christmas” and not have it cost her an arm and a leg.” It is suggested that this idiom actually derived from another idiom which is also still used commonly; “I would give my right arm for” which is used to mean that one really wants something and would do anything to get it. If this suggestion is correct then the phrase “it costs an arm and a leg” suggests that the cost is so enormous that one would not only have to give up their right arm but also a leg.
An example of this expression in use can be found in a quote by the British Conservative politician Francis Maude “I want to make it very open. We’ve researched the practicalities and there are lots of innovative ways of doing it that don’t cost an arm and a leg. We’ve looked to see if there’s a way of having a very open primary election that doesn’t kill us financially.”