Dexamethasone is used commonly in the treatment of chronic lung disease of prematurity, but there are concerns about possible deleterious effects on growth and bone. Our aim in this study was to examine the effects of dexamethasone treatment on bone and collagen turnover in preterm infants. Bone-specific alkaline phosphatase, the C-terminal propeptide of type I collagen (PICP, reflecting whole-body type I collagen synthesis), and the N-terminal propeptide of type III procollagen (P3NP, reflecting soft tissue collagen turnover), together with the C-terminal telopeptide of type I collagen (ICTP), urinary pyridinoline (Pyd), and deoxypyridinoline (all markers of collagen breakdown) were measured at weekly intervals over the first 12 wk of life in 14 preterm infants with chronic lung disease treated with dexamethasone. Results were expressed as SD scores relative to preterm control infants not treated with dexamethasone. PICP, P3NP, ICTP, and Pyd all showed marked decreases (-2.1 to -3.7 SD scores) during the first week of treatment (p < 0.001), returning to pretreatment levels after stopping dexamethasone. In the group as a whole, these collagen markers were negatively correlated with dexamethasone dose (p < 0.0001); negative correlations were also seen in most individual babies, although the slopes of individual regression lines varied by a factor of 2. Weight gain at 12 wk was correlated with PICP, expressed as the mean SD score over 12 wk for each baby, (r = 0.69, p < 0.01) but not with other markers or cumulative dose of dexamethasone. We conclude that dexamethasone markedly suppressed collagen turnover in preterm infants in a dose-dependent fashion, although some babies were more affected than others. The degree of suppression of type I collagen synthesis was a strong independent predictor of overall weight gain over the first 12 wk of life.