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Infections account for about half of neonatal deaths in low-resource settings. Limited evidence supports home-based treatment of newborn infections by community health workers (CHW).In one study arm of a cluster randomized controlled trial, CHWs assessed neonates at home, using a 20-sign clinical algorithm and classified sick neonates as having very severe disease or possible very severe disease. Over a 2-year period, 10,585 live births were recorded in the study area. CHWs assessed 8474 (80%) of the neonates within the first week of life and referred neonates with signs of severe disease. If referral failed but parents consented to home treatment, CHWs treated neonates with very severe disease or possible very severe disease with multiple signs, using injectable antibiotics.For very severe disease, referral compliance was 34% (162/478 cases), and home treatment acceptance was 43% (204/478 cases). The case fatality rate was 4.4% (9/204) for CHW treatment, 14.2% (23/162) for treatment by qualified medical providers, and 28.5% (32/112) for those who received no treatment or who were treated by other unqualified providers. After controlling for differences in background characteristics and illness signs among treatment groups, newborns treated by CHWs had a hazard ratio of 0.22 (95% confidence interval [CI] = 0.07–0.71) for death during the neonatal period and those treated by qualified providers had a hazard ratio of 0.61 (95% CI = 0.37–0.99), compared with newborns who received no treatment or were treated by untrained providers. Significantly increased hazards ratios of death were observed for neonates with convulsions (hazard ratio [HR] = 6.54; 95% CI = 3.98–10.76), chest in-drawing (HR = 2.38, 95% CI = 1.29–4.39), temperature <35.3°C (HR = 3.47, 95% CI = 1.30–9.24), and unconsciousness (HR = 7.92, 95% CI = 3.13–20.04).Home treatment of very severe disease in neonates by CHWs was effective and acceptable in a low-resource setting in Bangladesh.