Neonatal herpes, one of the most feared infections during infancy, continues to command the attention of many investigators. In the past year, important new findings were reported pertaining to epidemiology, diagnosis, prevention, and treatment of this disease. Unfortunately, practical solutions for many clinical problems remain elusive. This review describes recent advances in our understanding of neonatal herpes with particular emphasis on the dilemmas and controversies associated with management and prevention. Although elimination of neonatal herpes remains a distant goal, the review discusses reasons for hope, including improved prevention strategies based on recent epidemiologic data, development of new rapid diagnostic methods, and progress in the quest for an effective vaccine.