The effect of synthetic surfactant (Exosurf) replacement on complications from hyaline membrane disease (HMD) in infants < 32 weeks gestation and their resource utilization within a neonatal intensive care unit was studied in 1991-92. A control group was selected from infants admitted to the same unit during the preceding 3 years when Exosurf was not available. The infants were controlled for gestation, weight and severity of HMD. Infants given Exosurf had a significant reduction in the incidence of pulmonary interstitial emphysema (PIE), and a marginal decrease in the incidence of pneumothorax. They required fewer days on the ventilator and consumed less of the scarce financial resources. There was no difference in the mortality rate among the two groups. The changes seen were more evident among those infants between 30 and 31 weeks gestation, compared to those < 28 weeks.