All 121 infants with birthweight less than or equal to 1500 g (VLBW) discharged from our department through an 18-month period were followed up at two years of age. All but 10 infants were examined by cranial ultrasound scanning in the neonatal period. Six had died after discharge; and of these two had severe brain damage following neonatal intraventricular haemorrhage. Twelve children had definite neuromotor abnormality; of these, the nine children with spastic types of cerebral palsy had all been delivered vaginally. Of the remaining children, one half had at least one neurodevelopmental symptom suggesting perinatal brain damage. Outcome was associated to neonatal intraventricular/subependymal haemorrhage when complicated by ventricular dilatation. Outcome in children with simple haemorrhage was similar to that in children without haemorrhage. The association between outcome and haemorrhage was considerably reduced by simultaneously considering the associations of gestational age at birth and the use of mechanical ventilation in the neonatal period. Head circumference at follow-up was greatest in those children with haemorrhage complicated by ventricular dilatation, when adjusted for actual body weight, birth weight, and gestational age at birth.