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Objective: To identify factors associated with mother-to-child-transmission and late access to prevention of maternal to child transmission (PMTCT) services among HIV-infected women; and risk factors for infant mortality among HIV-exposed infants in order to assess the feasibility of virtual elimination of vertical transmission and pediatric HIV in this setting. Design: Observational study evaluating the impact of a provincial PMTCT program. Methods: The intervention was implemented in 26 counties of Yunnan Province, China at municipal and tertiary health care settings. Log linear regression models with generalized estimating equations were used to identify unadjusted and adjusted correlates for late ARV intervention and MTCT. Cox proportional hazard models with robust sandwich estimation were applied to examine correlates of infant mortality. Results: Mother-to-child- transmission rate of HIV was controlled to 2%, with late initiation of maternal ARV showing a strong association with vertical transmission and infant mortality. Risk factors for late initiation of maternal ARV were age, ethnicity, education, and having a husband not tested for HIV. Mortality rate among HIV-exposed infants was 2.9/100 person-years. In addition to late initiation of maternal ARV, ethnicity, low birth weight and preterm birth were associated with infant mortality. Conclusions: This PMTCT program in Yunnan achieved low rates of MTCT. However the infant mortality rate in this cohort of HIV-exposed children was almost three times the provincial rate. Virtual elimination of MTCT of HIV is an achievable goal in China, but more attention needs to be paid to HIV-free survival. [ABSTRACT FROM AUTHOR]