OBJECTIVE To investigate the ability of somatosensory evoked potentials (SSEP) to predict neurologic outcome in term neonates with birth asphyxia. METHODS Upper limb SSEP were performed on nine infants of 1-7 weeks of age who had perinatal asphyxia and an encephalopathy still present at 7 days of age. Comparison was made between the cranial ultrasound, electroencephalogram (EEG), SSEP and neurologic outcome at 9-36 months. RESULTS Normal SSEP were found in four infants, all of whom were normal on neurologic follow up at 9-12 months. Neonatal EEG performed on two out of four of these infants were also normal, while cerebral oedema was seen on cranial ultrasound in three of the four studies. No SSEP response was seen initially in three infants, all of whom had adverse outcomes (one death, two with spastic diplegia). In contrast, their neonatal EEG had shown normal background rhythms, while two of the three cranial ultrasounds revealed oedema. For two infants the initial SSEP was absent over one hemisphere and just present over the other. Both children were abnormal on follow up at 10-12 months but did not have a hemiparesis. CONCLUSIONS Upper limb SSEP appear more sensitive than EEG or cranial ultrasounds in predicting the short term neurologic outcome of neonates with asphyxia.