Background The prevalence of asthma has increased alarmingly in the past 2 to 3 decades. Increased antibiotic use in infancy has been suggested to limit exposure to gastrointestinal microbes and to predispose to asthma in later life. Objective To evaluate the association between antibiotic exposure during the first year of life and the development of asthma up to the age of 7 years. Methods A retrospective population-based study of a cohort of children enrolled in a nationwide employer-provided health insurance plan from January 1, 1999, through December 31, 2006, in the United States (n = 62,576). We evaluated the association between antibiotic exposure during the first year of life and subsequent development of 3 asthma phenotypes: transient wheezing (began and resolved before 3 years of age), late-onset asthma (began after 3 years of age), and persistent asthma (began before 3 years of age and persisted through 4-7 years of age). Results Antibiotic use in the first year of life was associated with the development of transient wheezing (odds ratio [OR], 2.0; 95% confidence interval [CI], 1.9-2.2; P <.001) and persistent asthma (OR, 1.6; 95% CI, 1.5-1.7; P <.001). A dose-response effect was observed. When 5 or more antibiotic courses were received, the odds of persistent asthma doubled (OR, 1.9; 95% CI, 1.5-2.6; P <.001). There is no association between antibiotic use and late-onset asthma. Conclusion Antibiotic use in the first year life is associated with an increased risk of early-onset childhood asthma that began before 3 years of age. The apparent effect has a clear dose response. Heightened caution about avoiding unnecessary use of antibiotics in infants is warranted.