Plasma concentrations of theophylline and caffeine in seven premature neonates receiving theophylline orally for treatment of apnea at age one to 9 days were measured by high performance liquid chromatography, ultraviolet spectrophotometry, and mass spectrometry. Plasma concentrations of caffeine increased from 1.8 mg/l (range = 0.1 to 3.7) at day one to 3.7 mg/l (1.3 to 8.0) seven days after initiation of theophylline therapy. Similarly, plasma concentrations of theophylline were 4.6 mg/l (1.5 to 7.5) and 11.0 mg/l (4.0 to 19.0) on days one and 7 of theophylline therapy, respectively. In contrast, four normal adult volunteers given theophylline orally for eight to ten days had plasma theophylline concentrations ranging from 3 to 14 mg/l but no measurable caffeine. This indicates that caffeine is a biotransformation product of theophylline in premature neonates and that the metabolic pathway followed by theophylline in premature infants includes a methylation reaction producing caffeine, whereas in adults, the major metabolic pathway involves oxidative reactions (demethylation and oxidation). Some pharmacologic effects attributed to theophylline during chronic therapy for apnea may in part be due to caffeine. Routine monitoring during theophylline therapy in premature neonates with apnea should include plasma concentrations of both theophylline and caffeine in order to assess the total methylxanthine load.