In this prospective cohort study, we explored individual- and household-level risk factors associated with diarrheal diseases among 251 children younger than 5 years in slum areas of urban Dhaka, Bangladesh. During the 3-month study period, diarrhea surveillance was conducted monthly, and spot checks of the household compound were performed at baseline to assess the presence of feces (animal or human) in the household compound and in cooking and food storage areas, and to assess whether cooked food was covered and refrigerated. We also collected caregiver reports on child mouthing behaviors. Children living in households with feces within 10 steps of cooking and food storage areas (odds ratio [OR], 8.43; 95% CI, 1.01-70.18), those with visible feces found on the ground of the household compound (OR, 4.05; 95% CI, 1.24-13.22), and those in households found to keep cooked food uncovered and without refrigeration (OR, 6.16; 95% CI, 1.11-34.25) during spot checks had a significantly greater odds of diarrhea. There was no significant association between pediatric diarrhea and caregiver-reported child mouthing behaviors or presence of animals in the cooking area. These study findings demonstrate that presence of visible feces in the household compound and near cooking and food storage areas, and poor household food hygiene practices, were significant risk factors for diarrheal disease among young children in Dhaka, Bangladesh. Health communication programs are needed to target these exposure pathways to fecal pathogens.