Background: Globally, there has been progress in reducing maternal and under-5 child deaths in the past 2 decades; however, the progress in reducing newborn mortality has been slower with estimated 3 million neonatal deaths per year. In Ethiopia, unhealthy newborn care is common at home deliveries compared with institutional births that might be associated with neonatal deaths. The purpose of the current study was to assess the practices of immediate newborn care at home and institutional deliveries in rural Sidama Zone, 2017. Methods: A population-based cross-sectional survey was used. The study was conducted in 5 districts of Sidama Zone, from January 21 to February 4, 2017. A total of 2300 mothers who gave live births in the past 6 months were selected using a 2-stage cluster sampling methods. Data were entered, cleaned, and recoded using Epi Data and SPSS for analysis. Accordingly, descriptive and bivariate analyses were done, and the results are presented using P values. Results: The response rate was 99% (2279/2300). About one-third of the mothers are in the age group of 20 to 24 years, and 94.6% of them had at least 1 antenatal care follow-up. Most (72%) mothers delivered at health facilities. The practices of skin to skin care of the babies was 52% (61% at health facilities, 28% at home; P < .002). Baby bathing delay for at least 24 hours was 78% and clean cord care was 73% overall (home 21% vs health institution 93.6%). The cord was not tied in 11.6% of cases all of whom were home births (P < .001). As to immediate breastfeeding of the child, most (78%) of the babies were put to the breast within an hour of birth with no significant difference between the 2 places of births (P = .75). Conclusion: In this study, giving birth at health facilities did not make immediate newborn care practices universal, but unhealthy practices were more common among home births. Therefore, more efforts to promote community-based immediate newborn care are needed with great emphasis to proper thermal care.