The impact of air pollution on fetal growth remains controversial, in part, because studies have been limited to sub-regions of the United States with limited variability. No study has examined air pollution impacts on neonatal health care utilization. We performed descriptive, univariate and multivariable analyses on administrative hospital record data from 222,359 births in the 2000, 2003 and 2006 Kids Inpatient Database linked to air pollution data drawn from the US Environmental Protection Agency's Aerometric Information Retrieval System. In this study, air pollution exposure during the birth month was estimated based on birth hospital address. Although air pollutants were not individually associated with mean birth weight, a three-pollutant model controlling for hospital characteristics, demographics, and birth month identified 9.3% and 7.2% increases in odds of low birth weight and very low birth weight for each μg/m(3) increase in PM(2.5) (both P<0.0001). PM(2.5) and NO(2) were associated with -3.0% odds/p.p.m. and +2.5% odds/p.p.b. of preterm birth, respectively (both P<0.0001). A four-pollutant multivariable model indicated a 0.05 days/p.p.m. NO(2) decrease in length of the birth hospitalization (P=0.0061) and a 0.13 days increase/p.p.m. CO (P=0.0416). A $1166 increase in per child costs was estimated for the birth hospitalization per p.p.m. CO (P=0.0002) and $964 per unit increase in O(3) (P=0.0448). A reduction from the 75th to the 25th percentile in the highest CO quartile for births predicts annual savings of $134.7 million in direct health care costs. In a national, predominantly urban, sample, air pollutant exposures during the month of birth are associated with increased low birth weight and neonatal health care utilization. Further study of this database, with enhanced control for confounding, improved exposure assessment, examination of exposures across multiple time windows in pregnancy, and in the entire national sample, is supported by these initial investigations.