Background Nosocomial pneumonia (NP) due to multidrug-resistant (MDR) Gram-negative pathogens, has continued to rise over the last several decades. Parenteral administration of colistin results in poor alveolar penetration and subtherapeutic concentration; therefore, direct drug deposition at site of infection may improve the effectiveness while minimizing the systemic exposure. The aim of this study is to describe the safety and effectiveness of inhaled colistin for the treatment of NP caused by MDR Gram-negative pathogens. Method Patients who received inhaled colistin from May 2015 to May 2019 at 2 different tertiary care hospitals in Riyadh, Saudi Arabia were identified from pharmacy databases and their charts were retrospectively reviewed. Results 86 patients were enrolled in this study. The mean age was 56 ± 20 years. The mean Acute Physiology and Chronic Health Evaluation (APACHE II) was 17 ± 5. The responsible pathogens for NP were Pseudomonas aeruginosa (60%) Acinetobacter baumannii (28%), and Klebsiella pneumoniae (9%). Most patients (76/86) received concomitant intravenous antibiotics. Mean colistin total daily dose was 6 ± 3 million international units divided into 2–3 doses. Mean inhaled colistin duration of therapy was 11 ± 6 days. Favorable clinical outcome was achieved in 51 (59%) patients while favorable microbiological outcome occurred in 29 (34%) patients. Death due to all causes was noted in 39 (45%) cases. Renal injury occurred in 19 (22%) patients, all received concomitant intravenous colistin. Conclusion Inhaled colistin can be considered as salvage therapy as adjunct to intravenous administration for treatment of patients with NP due to MDR Gram-negative pathogens.