This paper is concerned with the syndrome of hepatitis and cirrhosis which has its onset in the first weeks of life and has been variously termed neonatal hepatitis, infantile hepatitis, giant-cell hepatitis and "the inspissated bile syndrome." This form of hepatitis in the newborn period has often been assumed to be due to the virus of infectious hepatitis, transmitted from the mother to the infant in utero, but this etiology has not been proven. Because this form of neonatal hepatitis is sometimes seen in several instances in the same family, an analysis of a possible hereditary component in the pathogenesis of this disease was undertaken. The study included a total of 59 families in which one or more offspring were affected with neonatal hepatitis. Excluding the index cases, there were 11 affected and 15 normal siblings in these families. The genetic analysis indicated the trait was consistent with an autosomal recessive mode of inheritance. In some families a number of normal children were born after the affected infant, and in other families women gave birth to affected and normal infants alternately. Consideration of these findings in relation to the known facts concerning transmission of hepatitis viruses is presented in the discussion.