Conjugated and direct bilirubin were measured in 288 samples from 107 neonates less than 15 days old. Retrospective analysis of the medical records showed that 53 neonates were hepatobiliary-normal, 42 patients had no obvious evidence of hepatobiliary disease but had received total parenteral nutrition, and 12 were clearly hepatobiliary-abnormal. Neither the mean values nor the distributions of either the conjugated bilirubin, as measured by a multilayered slide, or the direct bilirubin, measured by a solution diazo procedure, differed when comparing the hepatobiliary-normal population to that receiving total parenteral nutrition. However, as would be predicted, the hepatobiliary-abnormal population differed significantly from both of these groups using either direct bilirubin or conjugated bilirubin results. Samples obtained from hepatobiliary-abnormal neonates were reviewed in chronologic sequence if direct bilirubin results differed from conjugated bilirubin with respect to classification of normality/abnormality. In two of three neonates with developing cholestasis, conjugated bilirubin exceeded its upper limit of normal earlier than did direct bilirubin. Conjugated bilirubin returned to normal earlier than direct bilirubin for two neonates with an improving clinical status. Conjugated bilirubin measurement was judged to be more responsive to developing or resolving cholestasis then direct bilirubin. In addition, conjugated bilirubin measurement from the slide is known to agree well with that determined by high performance liquid chromatography fractionation of bilirubin and is less susceptible to interference than is direct bilirubin measurement, characteristics that recommend its use over direct bilirubin analysis in a clinical setting.