The painful nature of fractures has made it inevitable to use various anesthetic techniques to reduce or immobilize fractured parts. In the present study, axillary nerve block was compared with intravenous midazolam/fentanyl to induce anesthesia for Painless Reduction of Upper Extremity Fractures. The subjects in the present clinical trial consisted of 60 patients with upper extremity fractures. They were randomly divided into two equal groups of intravenous sedation (IVS) with midazolam/fentanyl and axillary nerve block (ANB). Rate of anesthesia induction, recovery time, and pain intensities at baseline, during the procedure and at the end of the procedure were recorded in both groups. Data was analyzed and compared between the two groups with SPSS 18 statistical software using appropriate tests. Demographic data, vital signs and means of pain intensities at the beginning of the procedure were equal in the two groups. In the IVS group, the overall duration of the procedure was shorter with more rapid onset of anesthesia (P<0.05). In contrast, the recovery time was much shorter in the ANB group (P<0.001). No life or organ threatening complications were observed in the two groups. Axillary nerve block can be considered an appropriate substitute for intravenous sedation in painful procedures of the upper extremity.