Because of the high prevalence of iron-deficiency anemia in Brazil, individual control measures tend to be ineffective, and fortification of foods with iron is considered the most effective method to fight anemia. To evaluate the effectiveness of fortification of drinking water with iron and vitamin C in the reduction of anemia in children in day-care centers in Belo Horizonte, Brazil. This before-and-after study evaluated 318 children aged 6 to 74 months. Identification data and data on socioeconomic variables were collected; anthropometric and biochemical measurements were performed before and after 5 months of fortification of water with 5 mg of elemental iron and 50 mg of ascorbic acid per liter. The fortified water was used for drinking and cooking at the day-care center. Wilcoxon's nonparametric test was used to evaluate the differences in continuous variables, and McNemar's test was used to compare the prevalence rates of anemia. The prevalence of anemia decreased significantly from 29.3% before fortification to 7.9% at the end of the study, with a significant increase in hemoglobin levels. Reductions in the prevalence rates of stunting and underweight were observed. Fortification of water with iron and vitamin C significantly reduced the prevalence of anemia and improved nutritional status among children attending day-care centers.