We have studied carbohydrate absorption in 40 healthy term infants and 10 preterm neonates (31-35 weeks gestation) by respiratory H2, fecal pH, and chromatographic analysis of stools. Sequential studies of H2 excretion (24-h collection) in response to breast feeding were carried out in premature infants during the first 8 weeks of life. Five expired H2 during the first 2 weeks, and two continued to do so in the 3rd to 4th weeks. Breath H2 excretion fell below 10 ppm by 8 weeks and was not related to feeding or sleep. In term neonates, the frequency of incomplete carbohydrate absorption (4-h test) at the end of the first week was 36% for 14 breast-fed, 42% for 12 formula-fed, and 64% for 14 mixed-fed neonates (not significant differences). There were no significant differences between the absorbing and malabsorbing subjects in fecal pH. Chromatographic analysis showed only small quantities of sugars. In summary, incomplete carbohydrate absorption occurred in a high percentage of the newborns studied; the 24-h test evaluated better than the 4-h test; and negative breath H2 excretion indicated development of the capacity of the small intestine to hydrolyze carbohydrates. In the majority of the preterm malabsorbing babies, completely functional lactase occurs within the first month of life. The growth modulators in human milk may increase the rate of maturing of the small intestine.