OBJECTIVE: To determine the prevalence of acute lower respiratory tract infections and the risk factors associated with living conditions among children up to 5 years of age in the city of Rio Grande, in the state of Rio Grande do Sul, Brazil. METHODS: A population-based cross-sectional study was carried out with 775 children. A standardized questionnaire was administered to the mother or other caregiver at the child's home in order to collect information on housing conditions, socioeconomic status, and smoking in the home. Additional variables examined included nutritional status, duration of breast-feeding, prenatal care, and utilization of health care services. Environmental variables were analyzed individually and were also grouped together in an "environmental score" that encompassed 10 variables: type of house construction, type of floor, home heating system, type of stove, dog in the child's room, dog in the house, cat in the child's room, cat in the house, number of people per room, and maternal smoking. The grouped environmental score ranged from 0 (best) to 10 (worst). The analysis included two stages: a bivariate stage, in which the prevalence ratio was calculated for each risk factor, and a multivariate stage, with logistic regression. RESULTS: The overall prevalence of acute lower respiratory tract infections was 23.9%. The main risk factors identified were: environmental score >/= 3 points, maternal schooling < 5 years, monthly family income < US$ 200, four or more people sharing the child's bedroom, and maternal smoking. Maternal age > or = 30 years was found to protect against the development of respiratory illness. CONCLUSIONS: Specific programs need to be implemented to control acute respiratory illnesses in the population studied. In future studies with this population, the environmental score that we developed could be used in place of the complete set of environmental variables that we tested. This environmental score should be applied in other contexts so as to determine its external validity.