BackgroundThis study aimed to assess undernutrition and associated factors among 24–36-month-old children in the slum areas of Bahir Dar city.MethodsA community-based cross-sectional study was conducted among 480 children from May 1 to 26, 2015. The simple random sampling technique was used to select respondents. Data were collected using a structured interviewer-administered questionnaire. Statistical Package for Social Sciences version 20 was used for analysis. The prevalence of undernutrition was computed. Binary and multivariable logistic regression analyses were also carried out to identify the association between the independent and dependent variables and the predictors of undernutrition, respectively. A P-value <0.05 was considered to be statistically significant in the final model.ResultThe prevalence of stunting, underweight, and wasting was 42%, 22.1%, and 6.4%, respectively. Independent predictors for stunting were illness in the preceding two weeks, having two children under three years old, taking prelacteal feeding, and early or late initiation of complementary feeding. Illness in the preceding two weeks, lack of latrine utilization, and lack of hand washing practice were independent predictors for underweight.ConclusionThere was a high prevalence of undernutrition in this study. Thus, health extension workers and health professionals in Bahir Dar city should educate mothers/caretakers on the health impact of giving prelacteal feeding, hand washing practice, time of initiation of complementary feeding, and birth interval.