Background Malaria is a major public health problem in sub-Saharan Africa, and children are especially vulnerable. In 2019, an estimated 409,000 people died of malaria, most (274,000) were young children and 94% of the cases and deaths were in Africa. Prior studies in Ethiopia focused on the adult population and high transmission areas. Hence, this study aimed to determine the prevalence and associated factors of malaria in children under five years in low transmission areas. Method A facility-based cross-sectional study was conducted among 585 under-five children who attended public health facilities in the Wogera district from September to October, 2017. Health facilities were selected by stratified cluster sampling, and systematic random sampling was held to select study participants from the selected facilities. Multivariable logistic regression was used to identify correlates of malaria. Result Of 585 children who provided blood samples, 51 (8.7%) had malaria. The predominant Plasmodium species were P. falciparum 33 (65%) and P. vivax 18 (35%). Regularly sleeping under long-lasting insecticide treated nets (LLIN) was associated with decreased odds of malaria (AOR = 0.08, 95% CI: 0.01–0.09), and an increased odds of malaria was observed among children who live in households with stagnant water in the compound (AOR = 6.7, 95% CI: 3.6–12.6) and children who stay outdoors during the night (AOR = 5.5, 95% CI: 2.7–11.1). Conclusion The prevalence of malaria in the study population was high. Environmental and behavioral factors related to LLIN use remain potential determinants of malaria. Continued public health interventions targeting proper utilization of bed nets, drainage of stagnant water, and improved public awareness about reducing the risk of insect bites have the potential to minimize the prevalence of malaria and improve the health of children.