Significant decrease in human immunodeficiency virus type 1 (HIV-1) vertical transmission has been observed worldwide in centers where interventions such as antiretroviral therapy (ART), elective cesarean section, and avoidance of breastfeeding have been implemented. This prospective cohort study aimed to assess the determinants of and the temporal trends in HIV-1 vertical transmission in the metropolitan area of Belo Horizonte, Brazil from January 1998 to December 2005. The rate of HIV-1 vertical transmission decreased from 20% in 1998 to 3% in 2005. This decline was associated with increased use of more complex ART regimens during pregnancy. Multivariate analysis restricted to clinical variables demonstrated that non ART, neonatal respiratory distress/sepsis and breastfeeding were independently associated with HIV-1 vertical transmission. When laboratory parameters were included in the model, high maternal viral load and non maternal ART were associated with HIV-1 vertical transmission. The results from this study confirm the impact of ART in the reduction of HIV-1 vertical transmission and indicate the need for improvement in the care and monitoring of mother and infant pairs affected by HIV-1.