A prospective study was done to determine the incidence of neutrophil storage pool (NSP) depletion in clinically septic neonates with peripheral neutropenia (less than 1500/mm3). Infants with NSP depletion were then randomized in a controlled study of polymorphonuclear leukocyte transfusions. Bone marrow examinations were done in 13 patients, and NSP depletion was noted in 3 (23%) patients. All patients with no NSP depletion had peripheral neutrophil recovery and 8 of 10 survived. Complications of meningitis contributed to both deaths. Two of the three patients with NSP depletion died. Neither the initial severity of illness nor the degree of peripheral neutropenia were predictive either of NSP depletion or of mortality. Most neonates with severe peripheral neutropenia and clinical sepsis had peripheral neutrophil recovery and survived with conservative management. Those at high risk could be identified only by examination of the NSP. Only those patients with NSP depletion should be considered for controlled studies of polymorphonuclear leukocyte transfusions.