We reviewed the records of 96 children hospitalized with varicella from July 1, 1975 to June 30, 1980. Eighty-one were immunologically normal and 15 were immunocompromised on the basis of neoplasia, immunosuppressive therapy, or genetic disease. These children experienced 106 complications including viral dissemination-encephalitis (44), bacterial infection (25), Reye's syndrome (17), unusual cutaneous lesions (eight), drug overdose (five), diabetic ketoacidosis (two), neonatal infection (two), dehydration (two), and exacerbation of preexisting nephrosis (one). The length of hospitalization varied from one to 38 days with a median of five days. There were ten varicella pneumonia (one), of neonatal varicella (one), and of a ruptured mycotic aneurysm secondary to septicemia (one). This review demonstrates (1) a substantial occurrence of life-threatening complications of varicella in childhood, and (2) a need for prospective epidemiologic data on the incidence of complications to determine the scope and extent of varicella vaccination.