To evaluate the efficacy, cost-effectiveness and acceptability of a 'high-density diet made from indigenous ingredients.The retrospective study was carried out from September 2009 to May 2010 in District Sanghar, Sindh, Pakistan. A field office was established and staff was recruited and trained. A baseline survey was done to screen for malnourished children aged 6-23 months using mid-upper arm circumference, for which a cut-off value of 115mm was adopted. The screened children with a weight-for-height z score-3 were registered and were supplied the high-density diet and micronutrients. Their mothers were counselled on infant and young child feeding practices.The mean age of 123 children in the study was 15.5±8.5 months, and mean weight was 5.91±1.18kg. Overall, 85(69%) children attained the target weight in a mean duration of 5.08±3.2 months. Besides, 29(23.5%) children were gaining weight, but had not achieved the target by the end of the study. The mean rate of weight-gain of children who recovered was 3.30±3.59 g/kg/day. No significant adverse effects were noted. There was no documented refusal of the therapeutic supplement. The net cost of rehabilitating a child was $34.31.The high-density diet was reasonably efficacious in improving the nutritional status of severely malnourished children.