Antenatal steroid treatment to enhance fetal lung maturity and surfactant treatment to prevent or treat respiratory distress syndrome have been major advances in perinatal medicine in the past 40 years contributing to improved outcomes for preterm infants. Use of postnatal steroids to prevent or treat chronic lung disease in preterm infants has been less successful and associated with adverse neurodevelopmental outcomes. Although early (in the first week of life) postnatal steroid treatment facilitates earlier extubation and reduces the risk of chronic lung disease, it is associated with adverse effects, such as hyperglycemia, hypertension, gastrointestinal bleeding and perforation, hypertrophic cardiomyopathy, growth failure, and cerebral palsy, and cannot be recommended. Early treatment with hydrocortisone may also improve survival without chronic lung disease, but concerns remain about possible adverse effects such as gastrointestinal perforation and sepsis, particularly in very preterm infants. Early inhaled budesonide also reduces the incidence of chronic lung disease but there are concerns that this may occur at the expense of increased risk of death. More studies of early low-dose steroids with adequate long-term follow-up are needed before they can be recommended for the prevention of chronic lung disease. Late (after the first week of life) postnatal steroids may have a better benefit-to-harm ratio than early steroids. A Cochrane Review shows that late steroid treatment reduces chronic lung disease, the combination of death and chronic lung disease at both 28 days and 36 weeks' corrected age, and the need for later rescue dexamethasone. Adverse effects include hyperglycemia, hypertension, hypertrophic cardiomyopathy, and severe retinopathy of prematurity but without an increase in blindness. Long-term neurodevelopmental effects are not significantly increased by late postnatal steroid treatment. Current recommendations are that postnatal steroid treatment should be reserved for preterm infants who are ventilator-dependent after the first 7-14 days of life and any course should be low dose and of short duration to facilitate endotracheal extubation. Budesonide/surfactant mixtures show some promise as a means of reducing chronic lung disease in preterm infants with severe respiratory distress syndrome, but further larger studies with long-term follow-up are needed before this treatment can be recommended as a routine intervention.