Perinatal audit is a measure of quality of care given in pregnancy and it gives an idea as to how the resources need to be allocated for better outcome. The perinatal mortality data in the National University Hospital over a 7-year period (1986-1992) were compiled and compared with that of the year 1982. The perinatal mortality rate (PNMR) of 14.6/1000 in 1982 declined to 8.9/1000 for the period 1986 to 1992 and the reduction was noticeable in all ethnic groups, particularly in the Malays. When lethal congenital malformations (LCMs) were excluded, the PNMR decreased to 5.7/1000. Such reduction is due to easy availability and acceptance of antenatal care, improvement in antenatal and intrapartum fetal surveillance and advances in neonatal care. Neonatal audit was extended beyond the first 7 days of birth which showed that the majority (65%) of deaths occurred in the first week and 15% occurred after the first month. The fear that intensive neonatal care serves to postpone death is not entirely substantiated. There was nearly a ten-fold rise in PNMR between the non-low birthweight and low birthweight groups. The important causes of perinatal mortality during the review period were LCMs (35.7%), complications of prematurity (17.9%) and asphyxia (15.3%). No cause was identifiable in 28.5%. Detailed analysis revealed that the standard of care could have been improved in a third of the cases (83/235) which could have led to further reduction of perinatal mortality rate.