Background: Renal dysfunction is a prevalent complication among patients admitted to intensive care units (ICUs), significantly impacting patient outcomes. Objectives: This study focuses on assessing the incidence of acute renal failure (ARF) in pediatric patients hospitalized in ICUs, exploring its occurrence and associated effects on patient outcomes. Methods: A prospective observational study was conducted to examine the incidence of ARF in pediatric patients admitted to a tertiary pediatric hospital's intensive care unit (PICU) in Iran from September 2019 to August 2020. Patients who developed ARF during their ICU stay were included in the study. Clinical and laboratory data were systematically collected upon admission and on a daily basis thereafter. This data collection aimed to elucidate differences in etiology, disease severity, and clinical practices, and to ascertain their impact on patient outcomes. Results: Out of 1145 pediatric ICU admissions, 4.3% experienced acute renal failure during their hospitalization. Of the 49 affected patients, information was available for 46 individuals, constituting the final analysis cohort. The staging of renal failure was categorized as follows: Stage I (45.7%), Stage II (19.6%), and Stage III (34.8%). Acute tubular necrosis emerged as the predominant cause of acute kidney injury (60.8%). The mortality rate among these patients was notably high at 39.1%, compared to the general PICU mortality rate of 7.1% during the study period. Non-survivors exhibited a higher prevalence of antibiotic use, particularly aminoglycosides and antifungal drugs. Additionally, resuscitation procedures were more frequently documented among non-survivors. Conclusions: Approximately 4.3% of pediatric ICU patients develop acute renal failure, with half of the cases manifesting within the initial 24 hours of hospitalization. Acute tubular necrosis stands out as the primary cause of acute kidney injury. A substantial proportion of patients (39.1%) succumb to the condition, particularly those subjected to resuscitation efforts or prescribed multiple antibiotics and antifungal drugs during hospitalization.