I report the case of an infant girl who was exposed to lithium during gestation and her follow-up at the age of 1 year. She presented with transient neurodevelopmental deficits including lethargy, hypotonia, and poor oral feeding ability in the neonatal period. She required supportive treatment and made gradual improvement in neurologic functioning. On examination at the age of 1 year, physical findings and psychomotor development were normal. The English literature from 1978 to 2004 is reviewed. A total of 30 patients who were exposed to lithium during gestation with adequate clinical description were identified. A significant number of these babies presented with neurodevelopmental deficits and depressed neurological status including hypotonia, respiratory distress syndrome, cyanosis, lethargy, and weak suck and Moro reflexes in the neonatal period. The majority of these abnormalities resolved and most babies made full recovery. Other abnormalities were structural as well as functional involvement of the cardiovascular system, macrosomia, prematurity, jaundice, diabetes insipidus, and involvement of the thyroid gland. While the use of lithium during pregnancy does not appear to significantly increase the risk of congenital anomalies, it is frequently associated with perinatal complications and reversible neonatal toxicity. Suggested guidelines for appropriate monitoring of infants and breast-feeding of exposed babies are presented. In addition, prenatal surveillance of women with bipolar disorders who are being treated with lithium is briefly discussed.