In a case-control study carried out in Montréal, Québec, Canada, between 1988 and 1990, indoor environmental factors were studied in relation to the incidence of asthma among 3- and 4-year-old children. Cases (n = 457), whose parents were recruited at a hospital emergency room, were children who had a first-time diagnosis of asthma (International Classification of Diseases, Ninth Revision, code 493) made by a pediatrician. Controls (n = 457) were chosen from family allowance files and were matched with case children on age and census tract. A telephone interview was administered to the children's parents. A 20% feasibility subsample was chosen to wear a nitrogen dioxide monitoring badge during a 24-hour period. Multiple conditional logistic regression analysis showed that after personal susceptibility factors were controlled for, the following were independent risk factors for asthma: the mother's heavy smoking (odds ratio (OR) = 2.77, 95% confidence interval (CI) 1.35-5.66), use of a humidifier in the child's room (OR = 1.89, 95% CI 1.30-2.74), and the presence of an electric heating system in the home (OR = 2.27, 95% CI 1.42-3.65). The presence of other smokers in the home was not quite significant (OR = 1.82, 95% CI 0.98-3.38). A history of pneumonia, the absence of breast feeding, and a family history of asthma were also significant risk factors. In a separate unmatched multivariate analysis of subjects who had worn the nitrogen dioxide badge, there was a dose-response relation between nitrogen dioxide (in parts per billion) and asthma. These results confirm the role of susceptibility factors in asthma and show that indoor environmental factors contribute to the incidence of asthma.