Despite numerous studies, controversy regarding the association between Ureaplasma urealyticum colonization of premature neonates and bronchopulmonary dysplasia (BPD) still exists. The aim of the present study was to determine the colonization rate of preterm ventilated neonates with the two U. urealyticum biovars, parvo and T960, and to assess the correlation between colonization and the development of BPD. A prospective study was done from February 2013 to January 2014 in neonatal intensive care unit (NICU) in Mansoura University Children Hospital (MUCH) and NICU of different specialized medical centers, with 100 ventilated premature neonates (< 34 weeks) in the first 24 h of life, where tracheal secretions were aspirated, transported and cultured on 10B broth and A7 agar media. Culture was positive in 10 out of 85 samples (11.8%) as compared to 15/85 (17.6%) samples obtained by PCR technique. PCR assay demonstrated that Parva biovar (biovar 1) was the predominant, found in 9 (60%) out of 15 Ureaplasma isolates, as compared to T960 biovar (biovar 2) in 6 (40%) isolates. None of the neonates were cocolonized with both biovars. There was a statistically significant difference in the mean gestational age and mean birth weight between neonates with positive Ureaplasma colonization and neonates without colonization. BPD was significantly higher among colonized neonates than non-colonized one, 12 (80%) of 15 colonized neonates developed BPD as compared to 21 (30%) of 70 non colonized neonates. BPD was found to be correlated to decreasing gestational age (r = -0.341, p=0.001), low birth weight (r = -0.328, p= 0.002), and Ureaplasma colonization (r = 0.391, p < 0.001). Logistic regression analysis revealed that Ureaplasma colonization was a more important predictor for development of BPD than decreasing gestational age. BPD rate was higher among neonates colonized with T960 biovar (biovar 2) than those colonized with parvo biovar (biovar 1) (83.3% vs. 77.7%) with statistical significant difference (p = 0.001). colonization of respiratory tract by U. urealyticum, particularly biovar 2 (T960 biovar) in premature ventilated neonates was related to the development of BPD. PCR is a sensitive and specific technique for detecting Ureaplasma and for distinguishing its biovars (Parvum and T960) directly from clinical samples.