Major changes occur in the pulmonary circulation at birth. Failure of normal adaptation leads to pulmonary hypertension of the newborn. The basis for this may be abnormal growth of the lung in utero or a failure of the mechanisms which lead to vasodilatation in the newborn period. This article describes normal development of the pulmonary arteries and veins, their branching pattern and structure and discusses the factors which may control this growth. Endothelial function and dysfunction are crucial in adaptation, and new experimental studies are aiding our understanding of the control and action of factors produced by the endothelium, e.g. nitric oxide, prostacyclin and endothelin. The study of infants with pulmonary hypertension, together with the experimental studies, will aid in producing effective methods of controlling increased pulmonary artery pressure in the newborn period.