This study examined the association between prenatal exposure to cocaine and physiological regulation across the first 7 months of age. Measures of respiratory sinus arrhythmia (RSA) were obtained from 169 (82 cocaine-exposed and 87 nonexposed) infants during baseline periods at 1 month and 7 months of age and during tasks designed to elicit positive and negative affect at 7 months of age. After controlling for maternal age, gestational age, and obstetrical risk, structural equation modeling indicated that the association between prenatal exposure to cocaine and baseline RSA at 7 months of age was direct even in the presence of an indirect effect through baseline RSA at 1 month of age. There were no indirect effects through maternal affect during mother-infant interactions assessed at 1 month of age. Analyses also indicated a direct association between prenatal exposure to cocaine and RSA regulation to negative affect at 7 months of age. (Contains 3 figures, 2 tables and 2 footnotes.)