ABSTRACT Single-dose nevirapine (sd-NVP) and extended NVP prophylaxis are widely used in resource-constrained settings to prevent vertical HIV-1 transmission. We assessed the pharmacokinetics of sd-NVP in 62 HIV-1-positive pregnant Ugandan woman and their newborns who were receiving sd-NVP prophylaxis to prevent mother-to-child HIV-1 transmission. Based on these data, we developed a mathematical model system to quantify the impact of different sd-NVP regimens at delivery and of extended infant NVP prophylaxis (6, 14, 21, 26, 52, 78, and 102 weeks) on the 2-year risk of HIV-1 transmission and development of drug resistance in mothers and their breast-fed infants. Pharmacokinetic parameter estimates and model-predicted HIV-1 transmission rates were very consistent with other studies. Predicted 2-year HIV-1 transmission risks were 35.8% without prophylaxis, 31.6% for newborn sd-NVP, 19.1% for maternal sd-NVP, and 19.7% for maternal/newborn sd-NVP. Maternal sd-NVP reduced newborn infection predominately by transplacental exchange, providing protective NVP concentrations to the newborn at delivery, rather than by maternal viral load reduction. Drug resistance was frequently selected in HIV-1-positive mothers after maternal sd-NVP. Extended newborn NVP prophylaxis further decreased HIV-1 transmission risks, but an overall decline in cost-effectiveness for increasing durations of newborn prophylaxis was indicated. The total number of infections with resistant virus in newborns was not increased by extended newborn NVP prophylaxis. The developed mathematical modeling framework successfully predicted the risk of HIV-1 transmission and resistance development and can be adapted to other drugs/drug combinations to a priori assess their potential in reducing vertical HIV-1 transmission and resistance spread.