This report discusses the magnitude of the problem of birth defects, outlines advances in the birth defects field in the past decade, and identifies those areas where research is needed for the prevention, treatment, and management of birth defects. The problem of birth defects has consumed a greater portion of our health care resources because of the reduction of infectious diseases and our ability to salvage and care for many malformed children. These health care costs are estimated conservatively at $20 billion per year. For every 1000 live births, 130 have genetic or anatomical defects. A genetic etiology accounts for 25 per cent of anatomical defects. The largest group of defects (65 per cent) is believed to be polygenic or multifactorial in origin. Contrary to the notion that the main causes of birth defects are environmental agents such as drugs, chemical, and/or ionizing radiation, information gathered in the last 20 years indicates that these environmental agents account for only 10 per cent of birth defects. During the past decade, a greater prevention of birth defects has resulted from epidemiologic surveillance, better management of maternal medical disorders and obstetric and neonatal factors, greater understanding of the role of environmental factors and genetic diseases, insights obtained from psychosocial observations, and legal and ethical opinions. However, although much has been achieved during the last decade, many areas still need to be investigated. The improved management of maternal disease states and the development of vaccines or effective treatment of intrauterine infections are areas for maximal investment of future resources. (Author/MP)