The Lao People's Democratic Republic (Lao PDR) is classified by the World Bank as a low-income country under stress. Development partners have sought to utilize effective aid instruments to help countries classified in this way achieve the Millennium Development Goals; these aid instruments include sector-wide approaches (SWAps) that support decentralized district health systems and seek to avoid fragmentation and duplication. In Asia and the Pacific, only Bangladesh, Papua New Guinea and the Solomon Islands have adopted SWAps. Since 1991, a comprehensive primary health care programme in the remote Sayaboury Province of Lao PDR has focused on strengthening district health management, improving access to health facilities and responding to the most common causes of mortality and morbidity among women and children. Between 1996 and 2003, health-facility utilization tripled, and the proportion of households that have access to a facility increased to 92% compared with only 61% nationally. By 2003, infant and child mortality rates were less than one-third of the national rates. The maternal mortality ratio decreased by 50% despite comprehensive emergency obstetric care not being available in most district hospitals. These trends were achieved with an investment of approximately 4 million US dollars over 12 years (equivalent to US 1.00 US dollars per person per year). However, this project did not overcome weaknesses in some national disease-control programmes, especially the expanded programme on immunization, that require strong central management. In Lao PDR, which is not yet committed to using SWAps, tools developed in Sayaboury could help other district health offices assume greater planning responsibilities in the recently decentralized system. Development partners should balance their support for centrally managed disease-specific programmes with assistance to horizontally integrated primary health care at the district level.