Herpes simplex encephalitis is usually a monophasic acute illness but can cause chronic disease, particularly in children. Little information is available as to the histological substrate. We report the findings in 3 children. In 2 children, herpes encephalitis had occurred during the first 2 years, but both later developed intractable epilepsy that led to neurosurgery. The biopsies showed chronic granulomatous inflammation with foci of mineralization. One child made a good post-operative recovery. The other was found post-operatively to have herpes simplex virus type 1 (HSV-1) DNA and elevated titers of HSV IgM antibodies in the CSE He was given acyclovir but after initial improvement developed hemiparesis, with extensive signal change on MRI. Repeat biopsy revealed florid granulomatous inflammation with necrosis. The third patient was an infant who had had a cutaneous facial HSV-2 eruption soon after birth. This was treated with topical acyclovir, after which she remained well until 2 months, when she presented with a relatively non-specific illness, developed blisters of the right hand and foot, and died a few days later. Necropsy revealed severe granulomatous encephalitis, most extensive in the temporal lobe and insula, and associated with mineralization. Our findings indicate that herpes simplex encephalitis in children can be complicated by chronic granulomatous inflammation with mineralization. This pattern of disease may be an under-recognized complication of herpes simplex infection during the first few years of life.