BACKGROUND: Where P. vivax and P. falciparum occur in the same population, the peak burden of P. vivax infection and illness is often concentrated in younger age groups. Experiences from malaria therapy patients indicate that immunity is acquired faster to P. vivax than to P. falciparum challenge. There is however little prospective data on the comparative risk of infection and disease from both species in young children living in co-endemic areas. METHODOLOGY/PRINCIPAL FINDINGS: A cohort of 264 Papua New Guinean children aged 1-3 years (at enrolment) were actively followed-up for Plasmodium infection and febrile illness for 16 months. Infection status was determined by light microscopy and PCR every 8 weeks and at each febrile episode. A generalised estimating equation (GEE) approach was used to analyse both prevalence of infection and incidence of clinical episodes. A more pronounced rise in prevalence of P. falciparum compared to P. vivax infection was evident with increasing age. Although the overall incidence of clinical episodes was comparable (P. falciparum: 2.56, P. vivax 2.46 episodes / child / yr), P. falciparum and P. vivax infectious episodes showed strong but opposing age trends: P. falciparum incidence increased until the age of 30 months with little change thereafter, but incidence of P. vivax decreased significantly with age throughout the entire age range. For P. falciparum, both prevalence and incidence of P. falciparum showed marked seasonality, whereas only P. vivax incidence but not prevalence decreased in the dry season. CONCLUSIONS/SIGNIFICANCE: Under high, perennial exposure, children in PNG begin acquiring significant clinical immunity, characterized by an increasing ability to control parasite densities below the pyrogenic threshold to P. vivax, but not to P. falciparum, in the 2(nd) and 3(rd) year of life. The ability to relapse from long-lasting liver-stages restricts the seasonal variation in prevalence of P. vivax infections.