Twenty four premature infants were evaluated in their homes at seven ages during the first year of life to determine whether sleep-wake state organization was related to either neonatal assessment or short-term developmental outcome measures. A model assessing environmental and biological influences on the maturational course of selected sleep-wake state parameters was also evaluated. Sleep-wake state variables and neonatal assessment items were related to each other, and both predicted developmental quotients at 6 months and 1 year of age. Concordance was present primarily in the domain of motor activities. Waking motor behaviors and motor activity in sleep seem to independently reflect an infant's level of developmental organization. Individual sleep-wake state variables were influenced by both biological and environmental factors during maturation. The developmental course of quiet sleep is primarily biologically determined, as evidenced by its relationship to the infant's birth status (gestational age or birth weight); the infant's behavior that results in being taken from the crib during the night, and the course of his/her sleep that occurs between midnight and morning are dependent on both biological factors (perhaps infant irritability), and post-birth experiences (perhaps the caregiver's response to infant irritability). The course of active sleep and wakefulness are dependent solely on environmental influences, and not on maturity at birth.