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Ophthalmia neonatorum is a form of bacterial conjunctivitis contracted by newborns during delivery and occurs during the first month of life. Etiologic factors include Neisseria gonorrhoeae, Chlamydia trachomatis, viruses and chemicals. Its prevalence differs in different parts of the world and is dependent mainly upon socioeconomic conditions, level of knowledge about general health, standard of maternal healthcare as well as the type of prophylactic program used. This randomized clinical trial was performed during the years 2004–05 in the Delivery Section of Vali-e-Asr Hospital on 330 neonates who were divided into three equal groups of 110; Group A received betadine eye drops, Group B received Erythromycin eye drops and Group C (control group) received no treatment. Results showed that clinical conjunctivitis occurred in 52 subjects (17%), 58% of whom constituted males. On the whole, 9% of the infected newborns were from group A, 18.4% from group B and 22.4% from group C. It was concluded that 2.5% sterile betadine eye drops had a pronounced effect on ophthalmia neonatorum (p=0.030).