Over the last 2 decades, for-profit dialysis units have become the most common providers of renal replacement therapy for adults with end stage renal disease (ESRD) and have had an increasing role in the dialysis of children. We undertook a study to determine whether dialysis facility profit status influences the choice of dialysis therapy in the pediatric population. Cross-sectional study of national data from the Health Care Financing Administration. Free-standing and hospital-based outpatient dialysis facilities in the United States. A total of 1568 children and adolescents (</=19 years of age) eligible for US Medicare ESRD benefits in 1994. The association between dialysis modality choice and the profit status of the facility. Crude associations were estimated by the OR of a patient being treated with peritoneal dialysis (PD) versus hemodialysis at nonprofit versus for-profit facilities. Adjusted associations were estimated using logistic regression analysis. In bivariate analysis, children with ESRD dialyzed at nonprofit facilities were nearly three times as likely as those at for-profit facilities to be on PD (OR: 2.9; 95% CI: 2.3,3.6). In multivariate analysis, after controlling for patient age, sex, race, cause and duration of ESRD, free-standing versus hospital-based facility, and the pediatric expertise of the facility, patients at nonprofit facilities were more than twice as likely as those dialyzed at for-profit facilities to be on PD (OR: 2.3; 95% CI: 1.6, 3.4). After taking into account the clustering of patients within facilities, the association between nonprofit status and the use of PD persisted (OR: 2.2; 95% CI: 1.5,3.2). Children with ESRD treated at nonprofit facilities are more likely to receive PD than are those treated at for-profit facilities even after controlling for other patient and facility characteristics. This finding suggests that clinical decision making for pediatrics may be influenced by the ownership of the health care facility in which the patient is treated.