Periventricular/intraventricular hemorrhage occurs commonly in the premature newborn. Recent studies indicate an incidence of 35-45%. Following PVH/IVH, the likelihood of developing hydrocephalus is related to the severity of the hemorrhagic lesion. Ventricular dilation may be due to an obliterative arachnoiditis affecting principally the posterior fossa or, less commonly, due to obstruction of flow of cerebrospinal fluid within the ventricular system by clots or other debris. With moderate to severe hemorrhagic lesions, ventricular dilation may occur at the time of PVH/IVH. More commonly, progressive dilation begins one to three weeks following PVH/IVH. The classical signs of hydrocephalus, ie. bulging of anterior fontanelle and inappropriate increase in head circumference, may not appear for days to weeks following onset of ventricular dilation. The precise significance of such normal-pressure hydrocephalus in the genesis of brain injury in the newborn is unknown. Following diagnosis of PVH/IVH, close surveillance of ventricular size with ultrasound scans is indicated. When there is slowly progressive ventricular dilation with normal intracranial pressure, the choice of therapy is made difficult because of frequent spontaneous arrest in such cases. Several modes of therapy have been reported including drugs to decrease the formation of cerebrospinal fluid and the use of serial lumbar punctures. When ventricular dilation is rapid with intracranial hypertension, ventricular drainage is indicated.