During sepsis, many organs fail. In a sense, sinus node failure is the loss of the fine adaptation of heart rate to external circumstance, and, indeed, loss of normal heart rate variability is a well-known feature of many human illnesses. In early development, sinus node failure is manifest as what we have called abnormal heart rate characteristics (HRC) of reduced variability and transient decelerations, and we found that these appear early in the course of neonatal sepsis and systemic inflammatory response syndrome. Inspection of the electrocardiograms confirms that all of the cardiac rhythm is sinus, affirming the link of the clinical findings to modulation of the sinus node. Since no conventional heart rate variability measure detects reduced variability and transient decelerations, we devised optimized measures for this purpose. These include sample asymmetry, a measure of heart rate histogram shape, and sample entropy, which is similar to the familiar approximate entropy but has better statistical properties and less bias. We developed a predictive statistical model that we call the HRC index that is highly associated with impending neonatal sepsis. In clinical and mathematical studies, we have found that this HRC index is very highly significantly associated with imminent neonatal sepsis and death, rises before clinical signs of illness or abnormal laboratory test results, and is associated with neurodevelopmental outcome. In several neonatal intensive care units, monitored infants with neonatal sepsis have been diagnosed by positive blood cultures and treated with antibiotics without ever having signs of clinical illness. New work has focused on the hypothesis that vagal discharge is the mechanism of the decelerations. Surprisingly, we find that during the transient heart rate decelerations, the AV conduction time, measured as the PR interval, decreases. We conclude that mechanism of transient heart rate decelerations is not necessarily due to vagal activation. Instead, we hypothesize that the mechanism includes abnormal sinus node intracellular signal transduction resulting in abnormal modulation of phase 4 depolarization. We further hypothesize that abnormal profiles of circulating cytokines are responsible. Thus a measure of heart rate characteristics of reduced variability and transient decelerations is an early indicator of impending acute, severe neonatal illness. This clinical application of basic ideas about sinus node function and modulation may have benefit in clinical care of our most vulnerable patients.