Marijuana is the most commonly used illicit substance among pregnant women. Although there has been substantial concern about the effects of substance use during pregnancy, few studies have assessed the effects of prenatal exposure to marijuana and even fewer have provided longitudinal data on the developmental outcome of offspring. This is a report from a longitudinal study of substance use during pregnancy. The women in the cohort were of lower socioeconomic status, most were single, half were white and half were African-American. Women were interviewed at the fourth and seventh prenatal months, and women and children were assessed at delivery, 8, 18, and 36 months. Pediatric assessment included physical and cognitive development. At each study phase, mothers were interviewed about life style, living situation, current substance use, sociodemographic, and psychological status. Findings are reported on 655 women and children who were assessed at the third year. There were significant negative effects of prenatal marijuana exposure on the performance of 3-year-old children on the Stanford-Binet Intelligence Scale. The effects were associated with exposure during the first and second trimesters of pregnancy. Among the offspring of white women, these effects were moderated by the child's attendance at preschool/day-care at age three.