Background Children with acute peripheral facial nerve palsy cannot yet be recommended corticosteroid treatment based on evidence. Adults with idiopathic facial nerve palsy are treated with corticosteroids, according to guidelines resulting from a meta-analysis comprising two major randomized placebo-controlled trials. Corresponding trials in children are lacking. Furthermore, acute facial nerve palsy in childhood is frequently associated with Lyme neuroborreliosis, caused by the spirochete Borrelia burgdorferi. The efficacy and safety of corticosteroid treatment of acute facial nerve palsy associated with Lyme neuroborreliosis, has not yet been determined in prospective trials in children, nor in adults. Method This randomized double-blind, placebo-controlled study will include a total of 500 Swedish children aged 1–17 years, presenting with acute facial nerve palsy of either idiopathic etiology or associated with Lyme neuroborreliosis. Inclusion is ongoing at 12 pediatric departments, all situated in Borrelia burgdorferi endemic areas. Participants are randomized into active treatment with prednisolone 1 mg/kg/day (maximum 50 mg/day) or placebo for oral intake once daily during 10 days without taper. Cases associated with Lyme neuroborreliosis are treated with antibiotics in addition to the study treatment. The House-Brackmann grading scale and the Sunnybrook facial grading system are used for physician-assessed evaluation of facial impairment at baseline, and at the 1- and 12-month follow-ups. Primary outcome is complete recovery, measured by House-Brackmann grading scale, at the 12-month follow-up. Child/parent-assessed questionnaires are used for evaluation of disease-specific quality of life and facial disability and its correlation to physician-assessed facial impairment will be evaluated. Furthermore, the study will evaluate factors of importance for predicting recovery, as well as the safety profile for short-term prednisolone treatment in children with acute facial nerve palsy. Discussion This article presents the rationale, design and content of a protocol for a study that will determine the efficacy of corticosteroid treatment in children with acute facial nerve palsy of idiopathic etiology, or associated with Lyme neuroborreliosis. Future results will attribute to evidence-based treatment guidelines applicable also in Borrelia burgdorferi endemic areas. Trial registration The study protocol was approved by the Swedish Medical Product Agency (EudraCT nr 2017–004187-35) and published at ClinicalTrials.gov (NCT03781700, initial release 12/14/2018).