Studies of the effects of passive smoking on lower respiratory illness (LRI) have relied on questionnaires to measure exposure. We studied the association between two measures of passive smoking and the incidence of acute LRI in infants. We analyzed data from a community-based cohort study of respiratory illness during the first year of life in North Carolina. The incidence of LRI was determined by telephone calls at 2-week intervals. Environmental, demographic, and psychosocial risk factors for LRI were measured during home interviews. Tobacco smoke exposure was measured as the mean number of cigarettes smoked per day in the infant's presence. Smoke absorption by the infants was measured by the urinary cotinine/ creatinine ratio. Of the 485 infants in the study, 325 (67%) had telephone follow-up and at least two home interviews. In bivariate analyses, reported tobacco smoke exposure and urinary cotinine were associated with LRI. Only the association between reported exposure and LRI remained significant after adjusting for confounders, [adjusted incidence of LRI (episodes/child-year) non-exposed: 0.6; < or = 10 cigarettes/day: 0.9 (RR 1.5, 95% CI: 1.1, 2.0); > 10 cigarettes/day: 1.3 (RR 2.2, 95% CI: 1.3, 3.8)]. We conclude that infants reportedly exposed to tobacco smoke have an increased incidence of LRI. There are differences between questionnaire and biochemical measures of passive smoking. Urinary cotinine will not necessarily improve the validity of studies of the relationship of passive smoking to LRI in infants.