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Background. The outcomes for very low birth weight infants vary among neonatal intensive care units (NICUs), but the reasons for this variation are not well understood. We used the database of a large neonatology research network to determine whether either admission characteristics of the infants or specific characteristics of the units such as annual patient volume and the presence of a pediatric residency program could account for observed differences in neonatal mortality rates among units.We studied 7672 infants with birth weights from 501 to 1500 g treated during 1991 and 1992 at 62 NICUs participating in the Vermont Oxford Network Database.Overall, 14.7% of the study infants died within 28 days of birth (interquartile range 9.9% to 18.1%). The ratio of the number of observed deaths at an NICU to the number of deaths predicted based on the characteristics of infants treated at the NICU (standardized neonatal mortality ratio, [SNMR]) varied significantly among units (range 0 to 1.69, z = 4.24). There was no association between annual patient volume and either mortality rate (r = .17) or SNMR (r = .22). Observed mortality rates (17% vs 13%) and SNMR (1.04 vs .87) were both higher at the 24 hospitals with pediatric residency training programs than at the 38 hospitals without such programs. Hospitals with residency programs had higher average annual patient volumes (104 vs 66). In an analysis simultaneously adjusting for patient characteristics, volume, and presence of a residency program, neither volume (odds ratio [OR] per 10 additional cases treated 1.01, 95% confidence interval [CI], .98 to 1.04) nor presence of a pediatric residency program (OR 1.18, 95% CI, .94 to 1.47) was significantly associated with neonatal mortality risk.There are differences in neonatal mortality rates among NICUs that cannot be explained by differences in the measured admission characteristics of the infants, suggesting that the effectiveness of medical care varies among units. Neither the annual volume of very low birth weight infants treated in a unit nor the presence of a pediatric residency training program was independently associated with neonatal mortality rates for very low birth weight infants. Pediatrics 1997;99:149-156; neonate, very low birth weight, mortality, variation, volume, residency training.