Background: Stress hyperglycaemia is a transient increase in blood glucose level during stressful events and is common in critically ill children. Several studies have demonstrated increased risk of mortality in these children. There is paucity of information on this subject in sub Saharan Africa. The aim of this study was to describe the prevalence, outcome and factors associated with stress hyperglycaemia among children with severe acute malnutrition (SAM) admitted to the Mwanamugimu nutrition unit of Mulago hospital in Uganda. Methods: This study was conducted from August 2015 to March 2016 at the Mwanamugimu nutrition unit of Mulago hospital among severely malnourished children aged 1 to 60 months. Random blood sugar levels were measured. Stress hyperglycaemia was considered as a random blood sugar > 150 mg/dl. The final outcome was ascertained at death or discharge. Statistical analysis was done using the Chi square test and logistic regression. Results: Two hundred and thirty-five children were enrolled of whom 50% were girls. The median age was 5.1 months (range 1-60 months). Stress hyperglycaemia was present in 16.6% of the 235 participants. Several factors were significantly associated with stress hyperglycaemia at bivariate analysis; but on logistic regression, only presence of oral sores was associated with stress hyperglycaemia: (Odds ratio 2.61; 95% CI 1.02-6.65). Mortality was higher among children with stress hyperglycaemia (56.4%) compared to (12.8%) in the nonhyperglycaemic group: OR 8.75; 95% CI 4.09-18.70). Conclusion: The prevalence of stress hyperglycaemia was 16.6% and was associated with high mortality. It is important to monitor blood glucose levels of severely malnourished children. Hitherto, the main concern among severely malnourished children has been hypoglycaemia. Innovative ways of preventing and managing stress hyperglycaemia among these children are urgently needed.