Neonates often generate incomplete immunity against intracellular pathogens, although the mechanism of this defect is poorly understood. An important question is whether the impaired development of memory CD8(+) T cells in neonates is due to an immature priming environment or lymphocyte-intrinsic defects. In this article, we show that neonatal and adult CD8(+) T cells adopted different fates when responding to equal amounts of stimulation in the same host. Whereas adult CD8(+) T cells differentiated into a heterogeneous pool of effector and memory cells, neonatal CD8(+) T cells preferentially gave rise to short-lived effector cells and exhibited a distinct gene expression profile. Surprisingly, impaired neonatal memory formation was not due to a lack of responsiveness, but instead because neonatal CD8(+) T cells expanded more rapidly than adult cells and quickly became terminally differentiated. Collectively, these findings demonstrate that neonatal CD8(+) T cells exhibit an imbalance in effector and memory CD8(+) T cell differentiation, which impairs the formation of memory CD8(+) T cells in early life.