Serial cranial ultrasound studies, 133xenon inhalation cerebral blood flow determinations, and risk factor analyses were performed in 31 preterm neonates. Contrast echocardiographic studies were additionally performed in 16 of these 31 infants. Sixty-one percent were found to have germinal matrix or intraventricular hemorrhage. Seventy-four percent of all hemorrhages were detected by the thirtieth postnatal hour. The patients were divided into three groups: early GMH/IVH by the sixth postnatal hour (eight infants) interval GMH/IVH from 6 hours through 5 days (10), and no GMH/IVH (12). Cerebral blood flow values at 6 postnatal hours were significantly lower for the early GMH/IVH group than for the no GMH/IVH group (P less than 0.01). Progression of GMH/IVH was observed only in those infants with early hemorrhage, and these infants had a significantly higher incidence of neonatal mortality. Ventriculomegaly as determined by ultrasound studies was noted equally in infants with and without GMH/IVH (50%) and was not found to correlate with low cerebral blood flow. The patients with early hemorrhage were distinguishable by their need for more vigorous resuscitation at the time of birth and significantly higher ventilator settings during the first 36 postnatal hours, during which time they also had higher values of PCO2. An equal incidence of patent ductus arteriosus was found across all of the groups. We propose that early GMH/IVH may be related to perinatal events and that the significant decrease in cerebral blood flow found in infants with early GMH/IVH is secondary to the presence of the hemorrhage itself. Progression of early GMH/IVH and new interval GMH/IVH may be related to later neonatal events known to alter cerebral blood flow.