In order to obtain serum IgE reference values for small children we measured the total serum IgE concentration at the ages of 6 months, 1, 3, and 5 years in 66 healthy, non-atopic children who were followed from birth to 5 years of age. From this reference group we had excluded children with symptoms or signs of atopy during the follow-up period, as well as children with blood or nasal smear eosinophilia or positive skin prick tests. We also studied serum IgE levels in groups of children having latent atopy, symptomatic atopy, or severe atopic disease. We suggest that in the definition of reference values the upper limit of normal should be replaced by a zone of uncertainty, lying between the 95th and 97.5th percentiles. Serum IgE is a useful test with high specificity but low sensitivity in the differentiation between atopy and non-atopy. Thus high levels suggest atopy, while normal or low values yield little information. A normal serum IgE level does not necessarily exclude atopic disease.