Objective This study aimed to evaluate the impact of in-utero illicit fentanyl exposure on neonatal outcomes, including neonatal opioid withdrawal syndrome (NOWS), length of stay (LOS), and treatment requirements. Study Design This study was conducted from March 2020 to December 2022, and focused on neonates born to mothers with opioid use or opioid use disorder (OUD). Maternal opioid use was identified through self-report or umbilical cord tissue (UCT) testing. Severe NOWS was defined as cases requiring pharmacological treatment. Statistical analyses included univariate comparisons, logistic regression, and generalized linear models to assess the associations between fentanyl exposure and neonatal outcomes. Results Forty-seven percent (75/159) of infants had in-utero fentanyl exposure. Fentanyl-positive mothers were older, 31 ± 5 years, compared to non-fentanyl mothers, 29 ± 5, p = 0.01. They were also less likely to receive prenatal care (p < 0.01) and had a higher number of polysubstance used, 5 ± 1 compared to non-fentanyl mothers, 3 ± 1, p < 0.01. Overall, infants exposed to fentanyl had a higher incidence of severe NOWS (odds ratio = 5.8, 95% confidence interval [CI]: 2.49–12.95, p < 0.01) and required earlier NOWS treatment initiation, 1 ± 1 day compared to non-exposed infants 3 ± 2 days, p < 0.01. In adjusted analysis, fentanyl exposure was associated with a nearly three-fold increased risk of NOWS (Mantel–Haenszel combined relative risk = 2.98, 95% CI: 1.94–4.57). Furthermore, fentanyl exposure led to longer LOS, with a 40% increase for preterm neonates (p < 0.01) and a 63% increase for full-term neonates (p < 0.01). Additionally, there was a significant correlation between log fentanyl concentration in umbilical cord tissue and cumulative morphine dose required for NOWS treatment, p = 0.001. Conclusion Prenatal illicit fentanyl exposure is an independent and strong risk factor for severe NOWS presentation in newborns requiring extended hospital stays. Key Points