Diarrhoea is a common water-borne disease among slum children in Bangladesh. This study seeks to identify the engineering, behavioural and socio-economic determinants of childhood diarrhoea and its duration and to compute the resulting costs borne by slum dwellers. The study is based on a survey of 480 households in 32 slums in Dhaka. Nearly 50 percent of slum households reported diarrhoea episodes during the recall period of 15 days, with an average duration of 3.76 days of diarrhoea. The cost of child diarrhoea per episode ranges from BDT 124 (USD 1.81) to BDT 276 (USD 4). The annual cost of child diarrhoea for a representative child ranges from BDT 296 (USD 4.29) to BDT 656 (USD 9.51) based on assumptions about the value of leisure time lost by care givers. The yearly cost of child diarrhoea for a representative household ranges from BDT 378 (USD 5.49) to BDT 837 (USD12.15) or 0.6 percent to 1.3 percent of annual household income. Participation in NGO hygiene awareness activities, owning a radio and television, the mother's education level and hand washing reduce the probability of childhood diarrhoea while participation in NGO hygiene awareness activities, adoption of hand washing practices, and residence in a semi-pucca house structure reduce the duration of childhood diarrhoea. Our study suggests that more focus on water storage and hand washing in NGO and media campaigns and more concerted efforts by the state to provide clean water 24 hours a day to slum communities would go a long way towards controlling the incidence of childhood diarrhoea.