Thirteen neonates who underwent surgery under general anesthesia were studied for a cumulative total of 30 hr of intraoperative transcutaneous oxygen (tcO2) monitoring. Simultaneous umbilical or radial arterial blood gas measurements were recorded frequently throughout each operation. A variety of drugs and anesthetics (including halothane) were used during surgery. PaO2 ranged from 27 to 390 mm Hg and PaCO2 ranged from 11 to 75 mm Hg. All patients but one required adjustment of inspired oxygen to correct abnormal values. In 11 of 13 patients there was close correspondence between PaO2 and PtcO2 (r = .92) in the absence of hypotension. In one patient, the transcutaneous electrode came loose, in another patient with edema the tcO2 monitor was unreliable both during and after surgery (r = .25). A low PtcO2/PaO2 ratio (.48) in one patient suggested decreased blood volume, and the ratio returned to normal (1.0) after a blood transfusion. The tcO2 monitor was the earliest indicator of airway compromise (extubation and kinked endotracheal tube) in two patients. The tcO2 monitor was reliable with inspired halothane of 1% or less. Since intraoperative blood gases fluctuate greatly and because of the risks of hypoxia and retrolental fibroplasia, it is important that frequent blood gas monitoring be routinely performed during neonatal surgery. In the non-edematous, normotensive patient, the tcO2 monitor is reliable and can provide an early indicator of intraoperative airway compromise, hypovolemia, hypoxemia, or hyperoxemia.