BACKGROUND: In resource limited settings, there is variability in the level of adherence to clinical guidelines in the inpatient management of children with common conditions like severe anemia. However, there is limited data on the effect of adherence to clinical guidelines on inpatient mortality in children managed for severe anemia. METHODS: We analyzed data from an uncontrolled before and after in-service training intervention to improve quality of care in Lira and Jinja regional referral hospitals in Uganda. Inpatient records of children aged 0 to 5 years managed as cases of 'severe anemia (SA)' were reviewed to ascertain adherence to clinical guidelines and compare inpatient deaths in SA children managed versus those not managed according to clinical guidelines. Logistic regression analysis was conducted to evaluate the relationship between clinical care factors and inpatient deaths amongst patients managed for SA. RESULTS: A total of 1,131 children were assigned a clinical diagnosis of 'severe anemia' in the two hospitals. There was improvement in the level of care after the in-service training intervention with more children being managed according to clinical guidelines compared to the period before, 218/510 (42.7%) vs 158/621 (25.4%) (p < 0.001). Overall, children managed according to clinical guidelines had reduced risk of inpatient mortality compared to those not managed according to clinical guidelines, [OR 0.28, (95%, CI 0.14, 0.55), p = 0.001]. Clinical care factors associated with decreased risk of inpatient death included, having pre-transfusion hemoglobin done to confirm diagnosis [OR 0.5; 95% CI 0.29, 0.87], a co-morbid diagnosis of severe malaria [OR 0.4; 95% CI 0.25, 0.76], and being reviewed after admission by a clinician [OR 0.3; 95% CI 0.18, 0.59], while a co-morbid diagnosis of severe acute malnutrition was associated with increased risk of inpatient death [OR 4.2; 95% CI 2.15, 8.22]. CONCLUSION: Children with suspected SA who are managed according to clinical guidelines have lower in-hospital mortality than those not managed according to the guidelines. Efforts to reduce inpatient mortality in SA children in resource-limited settings should focus on training and supporting health workers to adhere to clinical guidelines.