The use of drugs for indications unapproved by the Food and Drug Administration (FDA), often called "off label use, "is widespread in children, including neonates. The widespread off-label use of drugs in neonates presents ethical and safety challenges. Since the passage of the Best Pharmaceuticals for Children Act (BPCA) in 2002, both the FDA and National Institutes of Health (NIH) have taken initiatives to facilitate and encourage research to achieve the necessary labeling for drugs routinely used in infants and children. Federal regulations provide broad rules and guidance for the protection of human subjects in research. However, there are ethical issues that a physician may face when designing clinical trials of drugs in neonates that are routinely used off-label and widely believed to be beneficial. We attempt to describe these ethical challenges and provide recommendations, including alternative study designs, to resolve them in an ethical framework that takes into account the Belmont Report, the statement of the World Medical Association (WMA), and federal regulations.