Background: Benign external hydrocephalus (BEH) is defined by rapid increase in head circumference in infancy, with neuroimaging evidence of enlarged cerebrospinal fluid (CSF) spaces. BEH was postulated to predispose to subdural hematoma, neurocognitive impairments, and autism. There is currently no consensus on BEH diagnostic criteria and no biomarkers to predict neurological sequalae.Methods: MRI-based quantitative approach was used for measurement of potential imaging markers related to external hydrocephalus and their association with neurological outcomes. We scanned 23 infants diagnosed with BEH and 11 age-similar controls. Using anatomical measurements from a large sample of healthy infants (n = 150), Z-scores were calculated to classify subject's CSF spaces as enlarged (≥1.96SD of mean values) or normal.Results: Subjects with abnormally enlarged CSF spaces had a significantly wider and longer ON (p = 0.017 and p = 0.020, respectively), and a significantly less tortuous ON (p = 0.006). ON deformity demonstrated a high diagnostic accuracy for abnormally enlarged frontal subarachnoid space (AUC = 0.826) and interhemispheric fissure (AUC = 0.833). No significant association found between enlarged CSF spaces and neurological complications (OR = 0.330, 95%CI 0.070–1.553, p = 0.161). However, cluster analysis identified a distinct subgroup of children (23/34, 67.6%) with enlarged CSF spaces and a wider, longer and less tortuous ON, to have an increased risk for neurological complications (RR = 7.28, 95%CI 1.07–49.40).Discussion: This is the first report on the association between external hydrocephalus, ON deformity and neurological complications. Our findings challenge the current view of external hydrocephalus as a benign condition. ON deformity is a potential auxiliary marker for risk stratification in patients with enlarged CSF spaces.