Laos is one of the poorest countries in which chronic malnutrition is highest. The aim of the present study was to determine the prevalence of and to identify risk factors associated with protein-energy malnutrition (PEM) in children under 5 years of age in Luangprabang province, Laos. This cross-sectional study was undertaken from March to May 2004. Anthropometric measurements of 798 children were done and data were transformed into height-for-age, weight-for-age and weight-for-height ratios. Mothers were also interviewed with a semi-structured questionnaire. Anthropometric data were entered into Nutstat in Epi-Info 2000 and transferred to SPSS for analysis. There was a high prevalence of stunting, underweight and wasting, that is, 54.6%, 35%, and 6% respectively. It was also noted that children aged 12-23 months and Khmu ethnic children had a higher prevalence of stunting (65% and 66%) and underweight (45% and 40%), respectively. However, it was also found that boys were more prone to be stunted and underweight. Furthermore, restricted intake of meats, vegetables during illness, and low maternal education were main risk factors for child malnutrition in the study area. Socioeconomic-demographic factors, low maternal education, poor nutrition knowledge for mother and feeding practices for sick children are affecting children's health regarding stunting and underweight. It is recommended that an improvement in societal infrastructure, better maternal education and nutrition are needed to address the child malnutrition issue.