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Congenital dislocation of the peroneal tendons is a rare and infrequently reported deformity of the foot in the neonate. Four cases of this deformity associated with a congenital calcaneovalgus deformity of the foot have been treated and followed to the resolution of both of the deformities. The calcaneovalgus foot proved more resistant to correction and required more prolonged and aggressive treatment than was usual when it was found as an isolated deformity. All four patients demonstrated other stigmata of intra-uterine malposition and oligohydramnios or both. Our anatomical studies suggested that the superior peroneal retinacular ligament was the critical stabilising structure for the peroneal tendons. A concept of the pathogenesis of this deformity is discussed and a proven regimen for its treatment presented.