Recent studies have suggested that ultrasound examinations may improve diagnostic accuracy in congenital dislocation of the hip, but there is differing opinion whether ultrasound diagnosis should be based on morphology or stability. Ultrasound was added to the routine clinical screening in 1503 newborns (1291 girls and 212 boys). Hip morphology was classified according to Graf (type 1-4), while sonographic stability was based on a modified Barlow maneuver, and classified as stable, elastic deflection (normal finding), unstable (provocating a gap between the femoral head and the acetabulum) and dislocated. Among 80 morphologically dysplastic hips, 73 (91%) were sonographically unstable or dislocated, while seven dysplastic hips were stable. On the other hand, in 49% of the sonographic unstable hips (69 out of 142) the acetabulum was either normal or just physiologically immature. 38 of these hips were left untreated and normalized spontaneously. There was a close correlation between sonographically and clinically determined hip stability (gamma = 0.95). Our study shows that the majority of morphologically dysplastic hips is sonographically unstable or dislocated, but also that morphologically dysplastic hips may be stable. Morphologically normal hips showing minor sonographic instability do probably not require treatment, and thus morphology seems to be an important diagnostic criterion.