Considering that neonatal pain is a relevant matter given its implications and consequences, many neonates, particularly those undergoing critical care, are subjected to analgo-sedation therapies, which commonly includes treatment with opioids and benzodiazepines. These drugs, however, can induce tolerance and dependency, leading to the development of the so-called iatrogenic withdrawal syndrome (IWS) which is observed following discontinuation of these therapeutic agents particularly when utilized for a prolonged period of time (≥5 days). IWS consists of signs and symptoms manifested especially in young children, such as term and premature newborns in the neonatal intensive care unit, who are less capable of metabolizing and eliminating these drugs, compared with older patients. In this study, we review assessment tools that were developed to identify, evaluate, and manage children affected by IWS. The studies reviewed demonstrate that optimal management of IWS includes consideration of alternate routes of drug administration, the need for adequate time for drug tapering, and also the presence of planned rescue therapy when encountering cases refractory to ongoing management. Equally important is prevention of IWS which can be accomplished with the implementation of drug rotation protocols and, adherence to evidenced-based guidelines which facilitate an overall decline in the use and duration of opioids and benzodiazepines. Finally, our review strongly supports the need for more research on IWS in neonates given their increased susceptibility and sparse published data for this age group.