The aim of the study was to test the hypotheses that elevated cerebral lactate, detected by proton spectroscopy performed within 18 hours of suspected birth asphyxia, is associated with adverse outcome, and that increased lactate can be used to predict adverse outcome. Thirty-one term infants suspected of having had birth asphyxia and seven control infants underwent proton magnetic resonance spectroscopy, using three-dimensional chemical shift imaging, within 18 hours of birth. Adverse outcome was defined as death or neurodevelopmental impairment at 1 year of age or more. Nine infants had an adverse outcome. The other 22 and all of the control infants remained normal. Median (range) lactate/creatine plus phosphocreatine (lactate/creatine) ratios in the abnormal, the normal, and the control group were 1.14 (0.17 to 3.81), 0.33 (0 to 1.51), and 0.05 (0 to 0.6) respectively (P=0.003). Lactate/creatine >1.0 predicted neurodevelopmental impairment at 1 year of age with sensitivity of 66% and specificity of 95%, positive and negative predictive values of 86% and 88%, and a likelihood ratio of 13.2. Elevated cerebral lactate/creatine within 18 hours of birth asphyxia predicts adverse outcome.