The developing brain has the capacity for a great deal of plasticity. A number of investigators have demonstrated that intellectual and language skills may be in the normal range in children following unilateral perinatal stroke. Questions have been raised, however, about whether these skills can be maintained at the same level as the brain matures. This study aimed to examine the stability of intellectual, academic and language functioning during development in children with perinatal stroke, and to resolve the inconsistencies raised in previous studies. Participants were 29 pre-school to school-age children with documented unilateral ischaemic perinatal stroke and 24 controls. Longitudinal testing of intellectual and cognitive abilities was conducted at two time points. Study 1 examined IQ, academic skills and language functions using the same test version over the test-retest interval. Study 2 examined IQ over a longer test-retest interval (pre-school to school-age), and utilized different test versions. This study has resulted in important new findings. There is no evidence of decline in cognitive function over time in children with perinatal unilateral brain damage. These results indicate that there is sufficient ongoing plasticity in the developing brain following early focal damage to result in the stability of cognitive functions over time. Also, the presence of seizures limits plasticity such that there is not only significantly lower performance on intellectual and language measures in the seizure group (Study 1), but the course of cognitive development is significantly altered (as shown in Study 2). This study provides information to support the notion of functional plasticity in the developing brain; yields much-needed clarification in the literature of prognosis in children with early ischaemic perinatal stroke; provides evidence that seizures limit plasticity during development; and avoids many of the confounds in prior studies. A greater understanding of how children with ischaemic perinatal stroke fare over time is particularly important, as there has been conflicting information regarding prognosis for this population. It appears that when damage is sustained very early in brain development, cerebral functional reorganization acts to sustain a stable rate of development over time.