Globally, severe acute malnutrition (SAM) accounts for >1/3–0⋅5 of deaths in children <5 years, and approximately 54 % deaths in developing countries. The minimum international standard set for the management of SAM is a cure rate of at least 75 % and death rate <10 %. The present study was conducted to determine treatment outcome and associated factors among children 1–5 years hospitalised with SAM in Lacor and Gulu Regional Referral Hospital (GRRH) in 2017. A retrospective observational method supplemented with a qualitative inquiry was done. A total of 317 patients’ records were reviewed in either hospital; checklist data were analysed using SPSS version 16 with P-values <0⋅05 considered for statistical significance. The case fatality rate (CFR) was 12⋅6 % (GRRH) and 9⋅5 % (Lacor). The average length of stay (LOS) was 14⋅69 d (GRRH) and 14⋅10 d (Lacor). There was statistical significance between Human Immunodeficiency Virus (HIV) status, blood transfusion, type of SAM, treatment provision at admission, antibiotics, mid-upper arm circumference (MUAC), hospital category and treatment outcome. In total, ten key informants were interviewed and they reported the presence of co-infections and severity of SAM complications as having an important bearing on treatment outcome. A significant proportion of patients were discharged not cured 19⋅9 % (Lacor) v. 16⋅4 % (GRRH). The CFR in GRRH was higher than the WHO recommendation. The LOS in both hospitals was within recommended. These results provide a generalisable problem in most African hospitals and could explain the persistently high rates of SAM in Africa.