Nitrogen dioxide is produced from the combustion of fossil fuels and as an emission from gas-fired appliances, and is also a component of tobacco smoke. Nitrogen dioxide has been shown in experimental animals to be toxic to the respiratory tract. A n number of recent studies have suggested that children exposed to significant levels of nitrogen dioxide in the home may be more susceptible to respiratory illness than children exposed to normal ambient levels. Respiratory illness is a major cause of morbidity in children everywhere. Here, we review the available evidence of this association and explore methodological issues in measurement of nitrogen dioxide exposure--misclassification of subjects, symptom bias and confounding. It has recently been shown that some New South Wales school rooms, where unflued gas heaters are often used as a source of warmth, have nitrogen dioxide levels which are above recommended ambient levels for outside air. This has underlined the need for setting standards for indoor levels of various pollutants, and cohort studies are suggested, to include personal monitoring and prospective data collection techniques.