This study used data that were representative of the normative population of all infants born in 1988 and were followed during the first 3 years of life. Large developmental delays and limitations in function were common among children weighing less than 1500 g at birth. Among very low-birth weight infants, minority status and living in a household headed by a single mother further worsen the disadvantages associated with a very low birth weight. Nor could the disadvantages associated with very low birth weight be accounted for by controls for other risk factors or buffering statuses and behaviors. Among all children (including those of very low birth weight) poverty, reliance on Medicaid and other government sources for health insurance, a history of risky behaviors, and inadequate prenatal care are the major risk factors for developmental delays, limitations in function, and impairment at birth. State program benefit levels have no obvious effects on child outcomes, taking into account participation in individual programs. An important finding in light of TANF is that maternal work, the use of child care, and the form and cost of child care did not influence developmental delay, limitation in function, or impairment, the outcomes that we were able to measure during the first 3 years of life. TANF eligibility requirements, however, may increase difficulty in obtaining prenatal and other medical services for mothers and children in need--factors shown here to be related strongly to increased risk of low birth weight and developmental delays, limitations, and impairments. Race and ethnicity, poverty status, and family structure are fundamental factors in early child development and function. Minority status, poverty, and single-parent households greatly increase the likelihood that a mother will engage in risky behaviors (smoking, alcohol use, illegal drug use) during pregnancy and receive inadequate prenatal care. Risky behaviors and inadequate prenatal care are the major risk factors for a baby of very low birth weight. When perinatologists first encounter a new patient who is of very low birth weight they often see an infant who is minority, in poverty, and in a single-parent household. Although such children did more poorly in development and function by age 3, the major effects of these variables were through the selectivity of such children into very low birth weight; the direct impact of these factors on development is somewhat muted. This research suggests there are a number of policies that can reduce development delays and functional limitations among children in the United States. Programs that are targeted to a mother and child (such as WIC, AFDC, health insurance coverage, and possibly the more recent TANF programs) significantly reduced the risk an infant will be of very low birth weight. Access and use of adequate prenatal care are essential. Programs designed to combat maternal behaviors that place the fetus at risk (smoking, alcohol, and illegal drug use) can be very successful in reducing the likelihood an infant will be of very low birth weight. An additional payoff from such programs comes after the birth, because even taking into account birth weight, these variables negatively impact on early childhood development and function. Single-parent family structure, race and ethnic minority status, and poverty status also are known to impact on kindergarten readiness, so that we expect a delayed impact of these variables on the child. The strength of this article is the use of normative population data to assess the role of birth weight in child outcome. We examined prenatal risk factors for a baby of very low birth weight, traced the manner by which these selective risks are reflected in the composition of very low-birth weight babies, demonstrated how a very low birth weight was fundamental to delays in development, and identified risk factors and potential buffers in this process. (ABSTRACT TRUNCATED)