There has been a noted increase in the number of institutional deliveries in all District Hospitals after implementation of the Janani Suraksha Yojana. Increased institutional deliveries increase the load of care for the newborns especially the sick newborns. Hence, Intensive New Born Care Units are being established at district hospitals under NRHM as per norms set by the National Neonatology Forum of India. The case study can be used to discuss the challenges in setting up such units based on the learning from the existing intensive new born care units, and the need to develop monitoring indicators.