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Prematurity and low birth weight have been considered to be important risk factors for cognitive development during early childhood; however, it has been suggested that the developmental delays disappear with age. Eighty-one preterm (<38 weeks) low birth weight (<2500 g) children between 5 and 8 years old from the Children of the National Longitudinal Survey of Youth were compared with individually matched full-term normal birth weight children to investigate the catchup delays in cognitive functioning including language and mathematics skills. Preterm children showed a significant delay in cognitive functioning only until 6 years old. Regression analyses showed that environmental factors accounted for more variation in cognitive development than did perinatal factors. In support of a transactional model, preterm children exhibited a self-righting tendency during their early childhood so that eventually environmental influences overshadowed biological influences.J Dev Behav Pediatr 14:242–249, 1993. Index terms:transactional model, cognitive development, preterm, low birth weight.