The pathophysiology of paradoxical elbow flexion contractures following neonatal brachial plexus injury (NBPI) is incompletely understood. The current study tests the hypothesis that this contracture occurs by denervation‐induced impairment of elbow flexor muscle growth. Unilateral forelimb paralysis was created in mice in four neonatal (5‐day‐old) BPI groups (C5‐6 excision, C5‐6 neurotomy, C5‐6 neurotomy/repair, and C5‐T1 global excision), one non‐neonatal BPI group (28‐day‐old C5‐6 excision), and two neonatal muscle imbalance groups (triceps tenotomy ± C5‐6 excision). Four weeks post‐operatively, motor function, elbow range of motion, and biceps/brachialis functional lengths were assessed. Musculocutaneous nerve (MCN) denervation and reinnervation were assessed immunohistochemically. Elbow flexion motor recovery and elbow flexion contractures varied inversely among the neonatal BPI groups. Contracture severity correlated with biceps/brachialis shortening and MCN denervation (relative axon loss), with no contractures occurring in mice with MCN reinnervation (presence of growth cones). No contractures or biceps/brachialis shortening occurred following non‐neonatal BPI, regardless of denervation or reinnervation. Neonatal triceps tenotomy did not cause contractures or biceps/brachialis shortening, nor did it worsen those following neonatal C5‐6 excision. Denervation‐induced functional shortening of elbow flexor muscles leads to variable elbow flexion contractures depending on the degree, permanence, and timing of denervation, independent of muscle imbalance. © 2012 Orthopaedic Research Society. Published by Wiley Periodicals, Inc. J Orthop Res 30:1335–1342, 2012