Background: Exchange transfusion (ET) is required in hyperbilirubinemic hospitalized neonates. Aims & Objectives: To study the effect of whole blood exchange transfusion to decrease serum bilirubin and raise haemoglobin in neonatal hyperbilirubinemia Materials & Methods: The study centre at SMS and associated hospitals. Blood bank is licensed and fully equipped. Fall in serum bilirubin minimum 40 cases were required as sample size of present study. Results: The rise in mean value of Hb after exchange transfusions was 0.85 gm/dl but when neonate’s haemoglobin was less than 12.5 g/dl the rise in mean value of Hb after exchange transfusions was 2.44 gm/dl. The average fall in total serum bilirubin was 47.71 %. The average fall in direct serum bilirubin was 73.51 %. The average fall in indirect serum bilirubin was 52.16%. Conclusion: While selecting Whole Blood for exchange transfusion it should also be checked for Haemoglobin and haematocrit values and the Whole Blood with higher Haemoglobin and Haematocrit (i.e. with values closer to normal neonatal Hb and Hct) should be preferred for exchange transfusion for better rise in neonatal Hb and Hct after the exchange transfusion. It was more effective in reducing direct bilirubin levels (73.51 %) compared to indirect (52.16%).