Pulmonary hypoplasia (PH) is defined as defective or incomplete development of lungs that are immature for gestational age. A prospective study was done to establish practical criteria for the diagnosis of pulmonary hypoplasia and to determine the relative frequency of pulmonary hypoplasia and its associated congenital malformations. Postmortem, formalin-inflated, routinely processed lungs were examined for fresh lung weight, fixed lung volume, radial alveolar count, and tissue maturity. Of these, lung volume was found to be the least useful. However, no single parameter was adequate for diagnosis in every case. Using the remaining three in conjunction, reliable diagnostic criteria were established. In this series of 113 cases, 22% had pulmonary hypoplasia as the primary cause of death, of which one-third had no associated congenital malformations to account for the development of pulmonary hypoplasia. It was found that premature rupture of membranes (PROM) for as short as 5 days could lead to fatal PH. It is concluded that PH is a common problem in neonatal autopsies and can be diagnosed in the average laboratory. Recognizing PH is important because once it has developed, intrauterine intervention in cases of oligohydramnios and postnatal treatment with surfactant inhalation cannot influence the outcome. It remains to be seen whether early fluid replacement in PROM will prevent development of PH.