Three severely asphyxiated term neonates demonstrated bilateral hyperechogenicity in the thalamus and basal ganglia. During evolution, areas of attenuated echogenicity appeared in these structures at the same time as periventricular cysts were evident in 2 patients with coexistent periventricular leukomalacia. All 3 patients developed ventricular dilatation; in the 2 patients with periventricular leukomalacia, the ventricular border was irregular in the outer (dorsal) margin, and interhemispheric fissures were widened as a manifestation of cerebral atrophy. Furthermore, the thalamic inner (ventral) margins of the lateral ventricles were irregular in all 3 patients. This previously unrecognized finding points to a particular form of cerebral atrophy localized in the gangliothalamic region that contributes to the development of ventriculomegaly. The reported sonographic sequence implies profound damage in the thalamus and basal ganglia in asphyxiated infants which undoubtedly has contributed to the poor outcomes of our patients.