A simple, nonsurgical means of differentiating biliary atresia (BA) from neonatal hepatitis has remained elusive. To determine its diagnostic usefulness, serum gamma-glutamyl transpeptidase (GGTP) levels were measured prospectively in 17 infants (aged 5 to 16 weeks) admitted consecutively to rule out BA. Seven patients were found to have BA, seven had neonatal hepatitis (NH), and three had alpha 1-antitrypsin (A1A) deficiency. The mean maximal GGTP level in those patients with NH (183 +/- 54 IU/L) was significantly lower than that found in patients with BA (760 +/- 492 IU/L) or A1A deficiency (1,725 +/- 921 IU/L). In the 14 patients without A1A deficiency, a serum GGTP level greater than 300 IU/L correctly identified six of seven patients with BA, while a GGTP level less than 300 IU/L correctly identified seven of seven patients with NH, although including one false-negative finding, in a patient with choledochal cyst and BA.