• Neonatal deaths in Iowa were reviewed for the years 1982 and 1983. As in a similar review of deaths in 1978 and 1979, respiratory distress syndrome, bacterial sepsis, asphyxia, lethal malformations, and extreme immaturity accounted for approximately 90% of deaths. Fewer deaths occurred in 1982 and 1983 and the causes of death shifted toward the nonpreventable. Lethal malformations became the leading cause of death and showed an increased incidence over the previous period. The greatest reduction of deaths was in level 1 hospitals. Ability to effect further reduction in neonatal deaths was estimated by calculation of an idealized neonatal mortality rate for the state and each level of care. These calculations suggest that future reduction in mortality must come primarily from improved care in level 2 and 3 centers rather than from further change in level 1 provider behavior.