Traumatic brain injury (TBI) may have a profound impact on a child's ongoing development. Various risk factors have been found to predict outcome, but considerable variability remains unexplained. This study used a prospective, longitudinal design to examine recovery of memory function following TBI within the pre school period. Ninety-six children with TBI were divided according to injury severity (mild, moderate, severe), and compared to age and SES matched healthy controls (n = 35). Children were evaluated acutely and at 6,12 and 18 months post-injury using intellectual and memory measures. Results showed a relationship between greater injury severity and poorer intellectual ability. This dose-response relationship was not clearly evident for memory function within the acute phase of recovery, but developed over time, with greater memory impairments evident for children with more severe TBI by 12 months post-injury. Children with mild TBI exhibited few memory problems. Findings are discussed in the context of theories of plasticity and recovery of function.