Aim - To estimate the accurate incidence and prevalence of permanent neonatal diabetes mellitus, and to determine the clinical profile of this condition in the Sultanate of Oman. Methods - All children diagnosed as having permanent neonatal diabetes mellitus between 1991 and 1995 in Oman were included in the study. Results - The mean incidence was 2.2 per 100 000 live births/year and the prevalence among under 5s during 1995 was 2.01100 000. Intrauterine growth retardation was noted in all (mean birthweight 1.86 kg), and diabetic ketoacidosis (mean plasma glucose 34.4 (SD 8.7) mmol/l, mean pH 7.17 (SD 0.09) in 80%. Hypertriglyceridaemia (mean serum triglyceride 19.06 (6.13) mmol/) was constant. No infant had clinical or immunological evidence of congenital viral infections. None had C-peptide excretion or circulating islet cell antibody during diagnosis or follow up. The other important features were parental consanguinity in all, HLA DR3/DR4 association in 80%, development of autoimmune hypothyroidism in one and observation of autoimmune disorders (insulin dependent diabetes mellitus and Hashimoto's thyroiditis) in family members. Conclusions - These findings strongly suggest an immune mediated aetiology for diabetes mellitus. The reported incidence of permanent insulin dependent neonatal diabetes mellitus in Oman is the highest in the world.