A prospective study to determine which clinical factors identified children with acute lower respiratory infection who were hypoxaemic and at risk of death was done over a 9-month period on children under 5 years of age admitted to a district hospital in rural Zambia. Of 158 children studied, 55 (35%) were found to be hypoxaemic and 23 (14.6%) died. For the subgroup of children under 1 year of age, a respiratory rate of > 70 was the only significant predictor of hypoxaemia (p < 0.001, sensitivity 63%, specificity 89%). In older children, only the presence of crepitations/bronchial breathing was predictive (p = 0.018, sensitivity 75%, specificity 57%). The likelihood of death was increased in those children with low oxygen saturation (p = 0.021) and poor nutrition (p = 0.007). It is concluded that, on the basis of raised respiratory rate, the WHO guidelines are likely to identify children under 1 year of age who are hypoxaemic. However, it may be necessary to include auscultatory findings in the guidelines to recognize hypoxaemia in older children in order to ensure that they receive appropriate treatment with oxygen. This study demonstrates that hypoxaemia and malnutrition are risk factors for death.