Objective To assess the contribution of the severity of bronchopulmonary dysplasia (BPD) and the time point of its diagnosis to the prediction of neurodevelopmental impairment (NDI) at corrected age of 2 years in preterm infants.Design Retrospective cohort study.Setting Level-III perinatal centre.Patients and outcome measures Infants born in 2000–2013 with gestational age 21% for ≥28 days and its severity classified as mild, FiO2=21%; moderate, FiO2 21% for ≥28 days nor mild or moderate BPD at either 36 or 40 weeks’ PMA was associated with NDI, but severe BPD was (at 36 weeks’ PMA 5.6 (2.0 to 16.0) and at 40 weeks’ PMA 16.6 (4.6 to 59.9)). Infants with severe BPD at both 36 and 40 weeks’ PMA had lower mental (mean difference −11.4 (−18.5 to −4.3), −25.7(−35.9 to −15.5), respectively) and motor (−7.8 (−14.9 to −0.6), −20.1(−30.7 to −9.5), respectively),developmental scores than infants without BPD.Conclusion In this cohort, severe BPD was a better independent predictor of NDI at 2 years than mild or moderate BPD. BPD diagnosed at 40 weeks’ PMA might allow better identification of infants at highest risk for NDI.