Studies in the Gambia, using the lactulose -mannitol dual-sugar intestinal permeability test (lactulose:mannitol ratio) as a non-invasive way of investigating mucosal damage, have shown that food malabsorption is significantly associated with early growth retardation. In this cross-sectional study, 210 poor urban Nepali children, 0 -60 months old, were recruited and measured for height or length and weight, 167 were examined for intestinal permeability and 173 for parasite infection. Weaning and morbidity data were collected from 172 caretakers. Children were mildly stunted (mean height-for-age z-score 2 1·45) and underweight (mean weight-for-age z-score 2 1·62). The lactulose:mannitol ratio (0·26) was poorer than that of UK children (0·12), but similar to that found in Bengali children of the same age (0·24). Two stages of weaning, the onset supplementary feeding (6 months) and the cessation of breast-feeding (23 months), were shown to have differential impact. In children currently breast-feeding, the duration of supplementation was negatively related to lactose (P, 0·001) and lactose:lactulose values (P, 0·0001), indicating lactose maldigestion. In children who had ceased breast-feeding, a longer period of lactation was associated with poorer intestinal permeability (P¼0·031), and poorer height-for-age (P¼ 0·024), which was an unexpected result. No significant relationships were found between intestinal permeability and growth, or with morbidity and helminth infection, except in children with Giardia lamblia who had worse lactulose:mannitol ratios than those without (0·43 v. 0·25 respectively, P¼ 0·014). It is likely that insults to the gut (e.g. Giardia) and challenges to the immune system (weaning) have a different impact in early and late infancy.Breast-feeding: Lactose digestion: Growth: Malnutrition: Malabsorption: Diarrhoea Poor growth status is an indicator of inappropriate living conditions and a poor environment (Tanner, 1986;Panter-Brick, 1998). In Nepal, children have been reported to have a high prevalence of growth retardation, in both rural areas (Costello, 1989;Panter-Brick, 1997) and among the urban poor (Panter-Brick et al. 1996;Moffat, 1998). Assessment of growth status among 6 -36-monthold Nepali children has shown that 49 % are underweight and 64 % are stunted (Nepal Nations Multiple Indicator Surveillance, 1995; cited in UNICEF, 1996). In infancy, growth faltering is evident from 6 months (Costello, 1989;Moffat, 1998).Most studies relate growth faltering to either food intake or infection. Lunn (2000), however, suggested that food malabsorption is a significant cause of malnutrition, resulting from abnormal function of the small intestinal mucosa. He outlined two possible mechanisms leading to undernutrition. First, following infection by dietary pathogens, possibly from unhygienic food preparation or storage, the villi in small intestinal mucosa are damaged and lose the vulnerable disaccharide lactase, leading to maldigestion of lactose and probably other nutrients. Second, the barrier f...