Pulmonary interstitial emphysema (PIE) is a common complication in premature infants with respiratory distress syndrome. The development of pulmonary interstitial emphysema leads to marked respiratory embarrassment in an already compromised infant. Although usually bilateral, PIE may be unilateral. Various forms of treatment for unilateral PIE in the premature infant have been described, including selective bronchial intubation, unilateral pneumonectomy, visceral pleurotomy, pure oxygen administration, and high-frequency low-pressure ventilation. A recently reported conservative regimen consisting of downward lateral positioning of the affected lung for several days may not be successful. We describe a premature infant with progressive worsening of unilateral PIE, which was successfully treated by selective bronchial balloon catheterization after failure of conservative management. In this manner, we avoided selective bronchial intubation or other aggressive forms of treatment.