The impact of early prophylactic use of intravenous indomethacin on the incidence and severity of periventricular-intraventricular hemorrhage and patent ductus arteriosus in 199 oxygen-requiring premature infants (less than or equal to 1300 g birth weight) was prospectively investigated. The trial was controlled, the infants were randomized, and the investigators were unaware of the group assignments. Patients with minimal (grade I) or no periventricular-intraventricular hemorrhage determined by prestudy echoencephalography were randomized within two birth weight subgroups (500 to 899 and 900 to 1300 g) to receive either prophylactic indomethacin (n = 99) or an equal volume of saline-vehicle placebo (n = 100). The first dose (0.2 mg/kg) was given within 12 hours of delivery and two subsequent doses (0.1 mg/kg) were administered at 12 hourly intervals. Prophylactic indomethacin significantly reduced the incidence of grades II to IV periventricular-intraventricular hemorrhage. Intraventricular hemorrhage was half as common in infants given prophylactic indomethacin as in control infants (23% v 46%, P less than .002). The reduction was manifested in both birth weight subgroups. Results of this study also confirmed a lower incidence of clinically significant patent ductus arteriosus in infants who received prophylactic indomethacin in contrast to those who received placebo (11% v 42%, P less than .001). No significant differences were found between treatment and control groups in the duration of oxygen therapy, mechanical ventilation, or hospitalization or in the incidence of pneumothorax, chronic lung disease, sepsis, necrotizing enterocolitis, retinopathy of prematurity, or death. Early prophylactic indomethacin initiated within 12 hours of delivery is effective in reducing the incidence of intraventricular hemorrhage as well as clinically significant patent ductus arteriosus in very low birth weight premature infants.