BACKGROUND: Short birth intervals are known to have negative effects on pregnancy outcomes. We analysed data from a large population surveillance system in rural Bangladesh to identify predictors of short birth interval and determine consequences of short intervals on pregnancy outcomes. METHODS: The study was conducted in three districts of Bangladesh - Bogra, Moulavibazar and Faridpur (population 282,643, 54,668 women of reproductive age). We used data between January 2010 and June 2011 from a key informant surveillance system that recorded all births, deaths and stillbirths. Short birth interval was defined as an interval between consecutive births of less than 33 months. Initially, risk factors of a short birth interval were determined using a multivariate mixed effects logistic regression model. Independent risk factors were selected using a priori knowledge from literature review. An adjusted mixed effects logistic regression model was then used to determine the effect of up to 21-, 21-32-, 33-44- and 45-month and higher birth-to-birth intervals on pregnancy outcomes controlling for confounders selected through a directed acyclic graph. RESULTS: We analysed 5,571 second or higher order deliveries. Average birth interval was 55 months and 1368/5571 women (24.6%) had a short birth interval (<33 months). Younger women (AOR 1.11 95% CI 1.08-1.15 per year increase in age), women who started their reproductive life later (AOR 0.95, 0.92-0.98 per year) and those who achieve higher order parities were less likely to experience short birth intervals (AOR 0.28, 0.19-0.41 parity 4 compared to 1). Women who were socioeconomically disadvantaged were more likely to experience a short birth interval (AOR 1.42, 1.22-1.65) and a previous adverse outcome was an important determinant of interval (AOR 2.10, 1.83-2.40). Very short birth intervals of less than 21 months were associated with increased stillbirth rate (AOR 2.13, 95% CI 1.28-3.53) and neonatal mortality (AOR 2.28 95% CI 1.28-4.05). CONCLUSIONS: Birth spacing remains a reproductive health problem in Bangladesh. Disadvantaged women are more likely to experience short birth intervals and to have increased perinatal deaths. Research into causal pathways and strategies to improve spacing between pregnancies should be intensified.