Candida species are important nosocomial pathogens in the newborn population, particularly among the premature very-low-birth-weight infants in neonatal intensive care units. Candida colonization of the neonatal skin and gastrointestinal tract is an important first step in the pathogenesis of invasive disease. C albicans is the most commonly isolated species in colonized or infected infants. Over the past decade the incidence of both colonization and infection with other Candida species, particularly C parapsilosis, has risen dramatically. Colonization of the infant occurs early in life and is affected by a variety of common practices in neonatal intensive care. Microbiol factors also augment colonization, including the ability of Candida to adhere to human epithelium. A better understanding of the complex interactions between host risk factors and virulence traits of colonizing yeast may allow the risk of systemic spread to be reduced in the population of premature infants.