Children with chronic renal failure (CRF) show developmental, intellectual and motor disturbances. It is questionable if an early start of renal replacement therapy may prevent or delay these disturbances. We studied the neurological and intellectual development of children < 5 years suffering from CRF (creatinine clearance < 20% of normal) prospectively, over a period of 3 years. As part of the neurological study, brainstem auditory evoked potentials (BAEP) and somatosensory evoked potentials (SSEP) were recorded. Measurements were performed in a group of 22 children every 6 months. In 18 of these children CRF was present from birth. Sufficient data were available for analysis in 19 (BAEP) and 22 (SSEP), respectively. A delay of peak I of BAEP gave indications for peripheral conduction disturbances, possibly due to cochlear dysfunction. Brainstem conduction was normal. There were no differences between the children treated conservatively (n = 9) and those treated with continuous ambulatory peritoneal dialysis (CAPD) (n = 10). In children < 2.5 years SSEP showed a delayed thalamocortical conduction, which was not observed in older children. This might indicate a delayed myelination in young children with CRF. No differences were found between the children treated conservatively (n = 10) and those treated with CAPD (n = 12).