Dislocation of the glenohumeral joint developed, in the first few years of life, in eight children who had brachial plexus birth palsy. The palsy involved the fifth and sixth cervical nerve roots in six children and the fifth, sixth, and seventh cervical nerve roots in two. All of the children had a release of the insertions of the pectoralis major, latissimus dorsi, and teres major followed by a closed reduction of the glenohumeral joint. The latissimus dorsi and the teres major were then transferred to the rotator cuff. All of the children had a well located glenohumeral joint with at least 25 degrees (mean, 51 degrees) of external rotation and at least 135 degrees (mean, 164 degrees) of abduction at the latest follow-up examination, at least two years postoperatively. Strength in abduction increased at least one grade, and strength in external rotation increased at least two grades. The improved motion and strength allowed the children to place the hands more effectively above the head and helped them to perform activities of daily living easily.