Colfosceril palmitate (dipalmitoylphosphatidylcholine) is the primary surface-active agent of natural lung surfactant and the major constituent of exogenous surface replacement preparations. Exogenous surfactants derived from either natural (i.e. animal and human) or synthetic sources are indicated for the prophylaxis and treatment of neonatal respiratory distress syndrome. One of the synthetic surfactants, Exosurf Neonatal, is the focus of this review. This preparation is composed of colfosceril palmitate plus cetyl alcohol and tyloxapol, which facilitate rapid spreading and adsorption of the surface-active agent at the air-alveolar interface. For review purposes, this preparation is referred to only as colfosceril palmitate. Comparative trials with air placebo have shown that colfosceril palmitate improves clinical outcome in infants weighing greater than 700g at birth by reducing mortality and increasing the number of infants who survive without bronchopulmonary dysplasia. It also reduces the number of deaths from respiratory distress syndrome and decreases the incidence of air leak events such as pulmonary interstitial emphysema and pneumothorax. Although colfosceril palmitate itself is very well tolerated and does not increase the incidence of most complications of prematurity or of respiratory distress syndrome, its use is associated with a higher incidence of apnoea of prematurity and pulmonary haemorrhage compared with air placebo, possibly because of earlier extubation of surfactant-treated infants following an improved clinical course and decreased pulmonary vascular resistance secondary to improved ventilation, respectively. Colfosceril palmitate thus has an established efficacy in the prophylaxis and treatment of premature infants with respiratory distress syndrome. Ongoing trials may identify whether prophylactic or rescue administration of the surfactant preparation is the preferred approach and whether different dosage regimens or different administration techniques impart greater therapeutic efficacy. Importantly, it also remains to be determined whether any of the available surfactant preparations, including Exosurf Neonatal, will provide distinct therapeutic advantages over the others.