A neonatal intensive care unit was established at one hospital in 1972 when the neonatal mortality was 7.6 and the perinatal mortality 20.9 per 1000 deliveries. In 1973, with full operation of that unit and partial introduction of a high-risk pregnancy unit for fetal monitoring, the rates decreased to 6.4 and 14.9, respectively. With full operation of both units the rates decreased further, to 3.4 and 9.0 in 1974 and 3.8 and 8.9 in 1975. The frequency of cesarean section was 10.1% in 1972-73 and 11.6% in 1974-75. It is concluded that the centralization of obstetric and neonatal care, together with the development of qualified medical and nursing teams, had a major impact in reducing perinatal mortality, and that the frequency of cesarean section was not affected by the introduction of fetal monitoring, although the indications for this precedure became more specific.