The motor, mental, and language development plus the home environment was examined in 217 twelve-month and 153 twenty-four-month-old children for whom prenatal exposure to marijuana, alcohol and cigarettes was previously ascertained. With this low-risk sample multiple regression analysis was used to assess the association between outcome measures and prenatal drug exposure while adjusting for potential confounding factors. Prenatal exposure to marijuana was uniquely positively associated with a series of items evaluating the child's attitudes and interests that reflect a cognitive factor. Moderate levels of alcohol were significantly associated with lower mental scores at 24 months of age. Prenatal maternal cigarette smoking was significantly associated with lower mental scores at 12 months of age and altered responses on auditory items at 12 and 24 months. However, at 24 months, the strong relationship of postnatal environmental factors with cognitive outcomes and with prenatal maternal smoking resulted in loss of significant, unique predictive power for maternal smoking. Based on the present work and supplemented by previously reported data pertaining to maternal attitudes during pregnancy and neonatal behaviour, a transactional interpretation is presented.