Using morphologic and bacteriologic techniques, we examined placentas from 224 deliveries considered potentially complicated by infection. The severity of the chorioamnionitis was graded histologically according to the intensity of the inflammatory infiltrate. Chorioamnionitis or funisitis occurred in 111 placentas. Neonatal morbidity in this group was 48 (43%) as compared with 14 (12%) in those without chorioamnionitis. Pathogens were cultured from 49 of the 111 placentas with chorioamnionitis. Neonatal morbidity or mortality occurred in 28 (58%) of the group with positive cultures but occurred also in 20 (32%) of the 63 with chorioamnionitis from which no pathogens were cultured. Perinatal mortality was especially high (64%) among premature infants (less than 30 weeks) with infection. A comparison of culture techniques (surface swab versus swab of subchorionic fibrin after searing amnionic surface) showed similar rates of recovery but less contamination using the deep culture technique. Neonatal morbidity and mortality with severe chorioamnionitis (grades II and III; 62% and 82%) were significantly greater than with little or no chorioamnionitis (grades I and 0; 43% and 36%). Higher grades of histologically demonstrable chorioamnionitis are associated significantly with the highest rates of neonatal morbidity or mortality. In many instances, pathogens are not recovered by conventional aerobic and anaerobic bacteriologic study. A search for other infectious agents (viruses, mycoplasmas, chlamydiae) deserves attention.