The objective of this study is to correlate the severity of hypothermia in sick extramural neonates with fatality and physiological derangements. This is a prospective observational study carried out at the referral neonatal unit of a teaching hospital admitting extramural neonates. The subjects comprised of 100 extramural hypothermic neonates transported to the Referral neonatal unit. Neonates weighing more than 1000 g, with abdominal skin temperature less than 36.5 degrees C at admission were included in the study. Hypothermia was classified as per WHO recommendations. Clinical features including age, weight, gestational age, clinical diagnosis, vitals, place of delivery, details of transportation and capillary filling time were recorded at the time of admission. Oxygen saturation was recorded by a pulse oximeter. Samples for sepsis screen, blood culture and blood glucose were taken at admission. During the study it was observed that fatality was 39.3% in mildly hypothermic babies, 51.6% in moderately hypothermic babies and 80% in severely hypothermic babies. However, the presence of associated illness (birth asphyxia, neonatal sepsis and respiratory distress), physiological derangements (hypoxia, hypoglycemia and shock) and weight less than 2000 g were associated with more than 50% fatality even in mildly hypothermic babies. When moderate hypothermia was associated with hypoxia or shock, the fatality was 83.3% and 90.9% respectively. Similarly, mild hypothermia with hypoglycemia was associated with 71.4% fatality. The conclusion drawn from this study is that the WHO classification of severity of hypothermia correlates with the risk of fatality. However, it considers only body temperature to classify severity of hypothermia. The presence of associated illness (birth asphyxia, neonatal sepsis and respiratory distress), physiological derangements (hypoxia, hypoglycemia and shock) and weight less than 2000 g should be considered adverse factors in hypothermic neonates. Their presence should classify hypothermia in the next higher category of severity in WHO classification.