The objectives of our study were to determine the actual frequency of the different disorders causing neonatal hypotonia and to assess the reliability of the first physical examination as well as the contribution of the main standard diagnostic tests. One hundred and forty-four infants diagnosed with neonatal hypotonia between January 1st 1999 and June 30th 2005 in our tertiary care facility were retrospectively included in the study. Perinatal history, clinical type of hypotonia, results of standard diagnostic tests, final diagnosis and outcome were abstracted from the original charts. A final diagnosis was reached in 120 cases. Central (cerebral) causes represented 82% of the elucidated cases, mostly hypoxic and hemorrhagic lesions of the brain (34%), chromosomal aberrations and syndromic disorders (26%) and brain malformations (12%). Peripheral (neuromuscular) causes were mainly represented by spinal muscular atrophy (6%) and myotonic dystrophy (4%). Positive predictive value of the initial clinical examination was higher in central type hypotonia. Neuroimaging, karyotype analysis and DNA-based tests were the most helpful diagnostic tools. These recent clinical data can be used to improve our strategy in investigating neonatal hypotonia and a diagnostic algorithm is proposed based on our findings.