We discuss the advantages of magnetic resonance (MR) technique in the study of the neonatal brain. Major results have been obtained concerning the understanding of the normal appearance of the developing brain. Bands of cells migrating to the cortex have been identified in the frontal periventricular white matter up to late gestation. MR can also identify the disappearance of the subependymal germinal matrix with increasing gestational age. With respect to the lesions of prematurity, subependymal germinal matrix hemorrhages were for the first time identified by MR underneath the posterior horns of the lateral ventricles. Subtle ischemic lesions of the periventricular white matter, not detected by brain ultrasound scan, are also described. Analysis of the lesions of the term neonates showed the role of MR in defining a more precise prognosis of infants who have sustained "birth asphyxia". The lesions can affect the basal ganglia, watershed areas of the white matter, and cortex. MR scans performed in the second week of life seem to show a stronger association with the outcome. Brain ischemic areas of the term neonates presenting with focal or multifocal seizures can also be detected by MR. These infarcted zones are usually located in the perfusion territory of the middle cerebral artery, more often in the left hemisphere. The timing of the scan is an important factor as the conventional MR can be negative in the first two-three days after the seizures. The diffusion-weighted imaging (DWI) is a new MR technique very sensitive to acute ischemic injury, and it may solve the problem of the scan timing.