BACKGROUND: Adverse neurodevelopmental outcome in premature infants is more common in the presence of certain ultrasonographically detectable intracranial lesions. Present nomenclature and classifications of parenchymal changes in preterm infants of varying gestations have led to some confusion. Descriptive definitions may be clinically useful. Regionalized perinatal and neonatal care enables population-based studies of these lesions and subsequent outcomes. METHODS: Two- to 3-year outcomes of neonates weighing 500 through 1249 g born in Alberta to Alberta residents during 1987 through 1990 were reviewed in relation to neonatal cerebral ultrasound lesions. Odds ratios and confidence limits for disability were calculated. RESULTS: Of 960 live births in this weight group, 669 (70%) survived to 1 year adjusted age; 646 (96.6%) were assessed at follow-up, and 80 (12.4%) of these were disabled: cerebral palsy, 8.7%; vision loss, 2.9%; hearing loss, 1.3%; epilepsy, 0.6%; mental retardation, 4.8%; more than one disability per child, 3.6%; and projected dependent disability, 1.4%. Lesions considered to be predictive of disability on ultrasound (excluding germinal layer hemorrhage) were found in 79 (11.8%), parenchymal lesions in 63 (9.4%) of 1-year survivors: intraventricular hemorrhage (IVH) (n = 59), persistent or transient cerebral ventriculomegaly (n = 50), persistent or transient intraparenchymal periventricular echodensity (n = 29), and cystic periventricular leukomalacia (n = 7). All lesions except isolated IVH were associated with adverse outcome; 37% of disabled children, 61% of multiply disabled children, and all children projected to become dependently disabled had parenchymal lesions with or without IVH. Triple lesions of IVH, cerebral ventriculomegaly, and intraparenchymal periventricular echodensity gave an odds ratio for disability of 50. Transient lesions had significant risk. CONCLUSIONS: This province-based study provides a descriptive scheme of serial neonatal cerebral ultrasound lesions and outcome considered useful for clinicians caring for newborns of lowest gestational ages. The overall incidence of parenchymal lesions was lower than frequently reported. Combinations of lesions were linked to increased incidence, complexity, and severity of childhood disability.