Increased hemolysis in the presence of severe neonatal hyperbilirubinemia appears to augment the risk of bilirubin neurotoxicity. The mechanism of this intensifying effect is uncertain. In direct antiglobulin titer (DAT) positive, isoimmune hemolytic disease, the bilirubin threshold at which neurotoxicity occurs appears to be lower than in DAT-negative hyperbilirubinemia. In other hemolytic conditions, the hemolysis may simply facilitate the development of extremely high serum bilirubin levels. Whether the hemolytic process per se exerts an independent effect or whether a very rapid rise in serum bilirubin might lead to greater penetration of the blood-brain barrier is unclear. In this review, we survey the synergistic role of hemolysis associated with severe hyperbilirubinemia in the potentiation of bilirubin-induced neurotoxicity and suggest methods of identifying at-risk babies with increased hemolysis to allow for their increased surveillance.