This study examines the possible health impact of marginal employment, including both temporary and part-time employment schemes. It addresses three research questions: (1) Are employed people with a fixed-term contract or no contract more likely to report poor health than those who hold jobs with permanent contracts? (2) Are part-time employed respondents (even when they hold jobs with permanent contracts) more likely to report poor health than full-time workers? (3) Does change in employment stability (i.e., from employment with permanent contract to fixed-term or no contract employment and vice-versa) have an impact on health status? Logistic regression models were used to analyze panel data from Britain and Germany (1991-1993), available in the Household Panel Comparability Project data base. We included 10,104 respondents from Germany and 7988 from Britain. A single measure of perceived health status was used as the dependent variable. Controlling for background characteristics, the health status of part-time workers with permanent contracts is not significantly different from those who are employed full-time. In contrast, fulltime employed people with fixed-term contracts in Germany are about 42 per cent more likely to report poor health than those who have permanent work contracts. In Britain, only part-time work with no contract is associated with poor health, but the difference is not statistically significant. We conclude that monitoring the possible health effects of the increasing number of marginal employment arrangements should be given priority on the social welfare research agenda.