We report the cases of neonatal lupus erythematosus associated with significant hepatic involvement in three living infants and in one infant who died 3 hours after delivery. The three living infants had neonatal cholestasis as a major component of their clinical findings. Pathologic changes included giant cell transformation, ductal obstruction, and extramedullary hematopoiesis. Liver involvement has been noted incidentally in children with neonatal lupus erythematosus, but it has generally been attributed to hemodynamic compromise as a result of congenital heart block or systemic toxic reactions. We speculate that neonatal hepatitis proceeding to hepatic fibrosis may occur in neonatal lupus erythematosus, analogous to the occurrence of "idiopathic" congenital heart block. The neonatal hepatitis associated with neonatal lupus erythematosus is a form distinguishable from the "idiopathic" group. Liver involvement may be more common than was previously recognized, and prospective studies to look for maternal autoantibodies in idiopathic neonatal liver disease should be undertaken.