Sixty-two neonates diagnosed to have periventricular-intraventricular hemorrhage were classified by sonographic findings as follows: mild, confined to the subependymal region or accompanied by a small amount of blood in the normal-sized lateral ventricle (10); moderate, intermediate amount of blood in the enlarged lateral ventricle (26); and severe, hemorrhage filling the entire ventricle forming a cast (12) or intraventricular hemorrhage with an intracerebral extension (14). Twenty-six of 35 surviving neonates had posthemorrhagic hydrocephalus, and 11 infants required shunt insertion. The survival rate of neonates with periventricular-intraventricular hemorrhage and the incidence of posthemorrhagic hydrocephalus correlated with the severity of the hemorrhage (P less than 0.05). The highest mortality rate was seen in the group with ventricular casts. All surviving neonates with casts developed hydrocephalus. All surviving neonates with intracerebral hemorrhage developed porencephaly. The severity of the hemorrhage correlated with short-term neurologic outcome (P less than 0.05), the group most severely affected being the one with intracerebral extension of hemorrhage. The severity of the hemorrhage also correlated with abnormal ventricular size by sonography on follow-up (P less than 0.05). However, posthemorrhagic hydrocephalus and abnormal ventricular size on follow-up did not correlate with neurologic outcome in the moderate and severe hemorrhage groups.