Surfactant Protein B (SP-B) deficiency has been recently identified as an uncommon, autosomal recessive lung disorder in term infants. This inability to produce SP-B leads to progressive, lethal, hypoxemic respiratory failure in the first year of life. A frameshift mutation (121 ins 2) is the predominant but not exclusive cause. The clue to diagnosis is to have a high suspicion of SP-B deficiency in any term infant with severe respiratory distress without any apparent cause. SP-B deficiency can be diagnosed prenatally or postnatally. The only current treatment options available include lung transplantation or compassionate care. Current developments in gene therapy offer hope for future treatment.