Objectives: To determine the prevalence of biochemical iron deficiency and identify factors associated with ferritin levels among 6-24-month-old urban South Island New Zealand children. Design: Cross-sectional survey conducted from May 1998 to March 1999. Setting: The cities of Christchurch, Dunedin and Invercargill. Subjects: A total of 323 randomly selected 6-24-month-old children participated (response rate 61%) of which 263 provided a blood sample. Methods: A complete blood cell count, zinc protoporphyrin, serum ferritin and C-reactive protein were measured on nonfasting venipuncture blood samples, 3-day weighed food records and general questionnaire data were collected. Results: Among children with C-reactive proteino10 mg/l (n ¼ 231), 4.3% had iron deficiency anaemia, 5.6% had iron deficiency without anaemia, and 18.6% had depleted iron stores, when a ferritin cutoff of r12 g/l was used. Age (negative), sex (girls4boys), ethnicity (Caucasian4non-Caucasian), weight-for-age percentiles (negative) and birth weight (positive) were associated with ferritin after adjusting for infection and socioeconomic status. When current consumption of iron fortified formula and 4500 ml of cows' milk per day were included, these were associated with a 22% increase and 25% decrease in ferritin, respectively (R 2 ¼ 0.28). Conclusions: The presence of suboptimal iron status (29%) among young New Zealand children is cause for concern, even though severe iron deficiency is rare, because children with marginal iron status are at risk of developing severe iron deficiency if exposed to a physiological challenge.