A significant portion of the health care dollar has been spent on neonatal intensive care since the early 1970s when technologic developments permitted salvage of very small premature infants. The wisdom of allocating so much for so few has been challenged, especially if the result is an increase in the number of severely mentally and motorically disabled children. Studies from around the world of the secular trends in mortality and morbidity for very and extremely low-birthweight babies uniformly indicate that there have been dramatic decreases in mortality and morbidity in the past 20 years. The relative proportion of moderate to severe disability has remained stable during this period of increasing survival potential. Thus, although the absolute numbers of children with disabilities caused by complications of very low birthweight may have increased slightly, they constitute a small minority of the overall number of children with disabilities requiring special educational and other services. Most surviving children with birthweights less than 1500 g remain free of significant functional impairments. It is often difficult for the clinician to identify early or even midway through the neonatal course which infants will have severe, life-long disabilities. By the time identification is feasible, heroic decisions about life supports are no longer called for. Thus, the ethical issues discussed earlier regarding decision-making based on anticipated quality of life become less relevant as the child's condition stabilizes. Given the generally favorable prognosis for even the smallest premature infant, the clinician is probably best advised to give the individual patient the benefit of the doubt. Undoubtedly, there will be exceptions. The more subtle effects of very low birthweight on learning and behavior are just becoming clear as long-term follow-up studies appear in the literature. Very low-birthweight infants who do not manifest severe disability do seem to be at risk for learning problems, although overall cognitive function is in the normal range. There are other effects of preterm birth. On average, stature appears to remain lower, although there may be catch-up growth later in childhood. Having a very low-birthweight infant places considerable stress on the family, but it is unclear whether this has a long-term impact. Studies have failed to show a consistent influence of preterm birth on long-term behavior. Behavior is likely affected more by the social-emotional milieu in which the child is reared than prematurity itself. The environment seems to take over in importance in affecting cognitive functioning after the first several years of life.(ABSTRACT TRUNCATED AT 400 WORDS)