Background: Treatment modalities for Neonatal jaundice include: Phototherapy, exchange transfusion, suppression of ISO–immunization by I.V I g, competitive inhibition of heme–oxygenase, induction of hepatic conjugation, inhibition of entero–hepatic circulation. Fluid therapy is other treatment modality. Do to paucity of literature regarding the role of extra fluids we decided to evaluate the beneficial effects of fluid supplementation in neonates with jaundice who need either phototherapy (PT) or exchange transfusion (ET). Material and methods: A total of 200 neonates, with hyperbilirubinemia were included in this study ,randomized into two groups (case group n=100; control group n=100).The case group was given I.V fluid supplementation with N/4 saline in 5% dextrose for a period of 8hrs, in addition to oral–feeds (Breast/formula feed). At the end of 8hrs period, the I.V fluid was discontinued. While the control group was continued on oral feeds and no IV fluids. Samples were obtained for serum osmolality, DCT, Reticulocyte–Count, Blood group, PBF (peripheral blood film), serum bilirubin etc in all babies included in the study. All infants received LED phototherapy. Comparison of the rate of decrease in bilirubin, length of hospital stay and the rate of exchange transfusion was done. Results: On the basis of decremental decrease in serum bilirubin levels 6 hourly, we found that there was statistically significant decremental decrease over the first 6 hours in study group when compared with control group (p–value=<0.001).Results of rate of exchange transfusion and duration of phototherapy were also statistically significant (p–value=<0.001). Conclusion: We recommend prolonged fluid administration especially to clinically dehydrated neonates which is not currently practiced, as the same leads to more rapid decrease of serum bilirubin and much less duration of phototherapy and hospital stay.