The impact of geography on incidence of clinical episodes of malaria was investigated in a cohort of children enrolled in a longitudinal clinical trial of antimalarial therapy in Kampala, Uganda. Participant households and the boundaries of local swamps and streams were mapped and incidence of clinical malaria episodes was measured prospectively using passive surveillance during one year of follow-up. Of 316 cohort participants, 305 from 219 households were followed for at least six weeks and were included in the analysis. Incidence of clinical malaria was highly variable, with no episodes occurring in 131 participants, and 367 new episodes of malaria diagnosed in the remaining 174 children. A gradient in incidence of clinical episodes of malaria was observed with distance of residence from a swamp (0.41 episodes per person year for residence > 100 meters from a swamp increasing to 2.22 episodes per person year for residence within a swamp), or a stream (0.61 episodes per person year for residence > or = 500 meters from a stream versus 1.76 episodes per person year for residence <500 meters from a stream). Multivariate analysis showed that distances of residence from a swamp or from a stream were independent predictors of malaria incidence, controlling for age, use of preventative measures, and primary source of water. Distance from a swamp was the strongest predictor, with an incidence rate ratio of 4.3 (95% confidence interval = 2.6-6.9, P < 0.001) between residence within a swamp and >100 meters from a swamp. In this urban setting, incidence of clinical episodes of malaria was strongly associated with proximity of residence to potential mosquito breeding sites.