We report here on a newborn with end-stage renal failure due to autosomal recessive polycystic kidney disease, also causing ventilation-requiring respiratory distress. Peritoneal dialysis was able to keep the newborn alive but not wean it from the respirator. After removal of both huge kidneys, dialysis became more effective and allowed the neonate to be extubated only 5 days later. It was decided to register the baby for a pediatric cadaveric kidney transplant when it reached 6 kg/body wt or to perform a living related transplant if no such kidney became available and the baby grew to 7 kg/body wt. At the age of 9 months and a weight of 6 kg a cadaveric kidney from a 20-month-old donor became available and was transplanted extraperitoneally. Prophylactic immunosuppression included cyclosporin, mycophenolate mofetil and steroids. Pneumonia on post-operative day 10 required respiratory care for several days and acute rejection requiring peritoneal dialysis. Both complications were controlled with antibiotics and conversion from cyclosporin to tacrolimus and a temporary increase in steroids. Thirteen months later the child is alive and well with a serum creatinine of 0.6 mg%. From this experience we would recommend early removal of both polycystic kidneys causing end-stage renal failure and respiratory insufficiency, starting peritoneal dialysis and performing a renal transplant as soon as possible. This therapeutic strategy seems appropriate for this complex situation.