Pneumonia is the biggest single cause of childhood morbidity and mortality under the age of five years in developing countries, including Ethiopia. A hospital based cross- sectional study was conducted with the objective of determining the prevalence of pneumonia and its associated risk factors among underfive children admitted to Dangila primary hospital, northwest, Ethiopia. Socio-demographic, environmental, nutrition and past co-morbidity related characteristics, and other clinical variables were collected from 384 caregivers/mothers and of their under-five children using structured questionnaire and patient records. Statuses of pneumonia ᴡas detected using rapid x-ray diagnostic detection method. Data were analyzed using statistical package software for social sciences (SPSS) version 20. Bivariate and multivariate logistic regression analyses were used to identify the possible risk factors of pneumonia among under-five children. Variables having p-value < 0.05 were considered as statistically significant. From the total of 384 under five children included in this study, 68(17.7%) were found to be pneumonia positive. A higher prevalence (31%) of pneumonia positive in this finding ᴡas observed in age range of 37-59 months. Under–five children from from parents who used firewood and charcoal as source of fuel for cooking were the most pneumonia affected as compared to children whose families use other items as a source of fuel for cooking food. No pneumonia cases were detected among households who were using electric power for food cooking. Under -five years old children ᴡho lived in urban area and located on mothers back during cooking were more likely associated with pneumonia than children who lived in rural area and outside the cooking house. Children from low educational status of parents were more affected by pneumonia than Children from high educational status of parents. In this study high prevalence of pneumonia was observed in children from smoker households than children from non-smoker households. Keeping cattle in the living room was an important risk factor for pneumonia positivity among under-five children. Partial breast feeder underfive children were more infected in pneumonia than those who were exclusive breast fed. Children were breast fed less than six months were the most affected in pneumonia than children were breast fed 6 to 12months. Relatively higher prevalence rates of pneumonia were found among children who had history of cough, fast breathing and difficulty in breathing, than those who did not report these clinical manifestations. Children who had tonsillitis in the last two weeks were more likely to develop pneumonia than Children who had no tonsillitis. Keywords: Dangila, Ethiopia, Pneumonia, Prevalence, Risk factors, Under-five children