Background Short stature is a manifestation of a wide variety of conditions that some of which may be amenable to timely treatment and a suboptimal growth rate may be an early marker pointing to the cause of growth retardation. This study was conducted to evaluate the diagnostic utility of growth rate in differential diagnosis of children with short stature. Materials and Methods All children between the ages of 2 and 18 years who visited in pediatric endocrinology clinic in a five years period were recruited in a prospective cohort study. Children with standing height Results One hundred forty three patients fulfilled the inclusion criteria. Mean follow up period was 14.4±10.9 months. Etiologies of short stature were: constitutional growth delay (CGD) 46.9%, familial short stature (FSS) 28.7%, hypothyroidism 4.2%, growth hormone deficiency (GHD) 4.2% and miscellaneous causes in 16% of patients. Mean Z- score for children with constitutional growth delay was -2.3±0.69, in familial short stature was -2.3±0.65 and for other condition was -2.7±1.49. There was a meaningful statistical correlation between growth rate and etiology of short stature (P 0.05). Conclusion There was significant difference in growth rate between children with constitutional growth delay and familial short stature in comparing to short stature due to endocrine problem and other etiologies. Assessment of growth rate has some utility in diagnosing the etiology of short stature.