Abstract: Chinese cloth diapers differ from disposable diapers in several respects that are central to our understanding of the etiology of diaper dermatitis (DD), yet there are no published reports on the dermatological correlates of this manner of infant care, which is prevalent among the world’s second-largest pediatric population. The objective was to determine the prevalence and severity of DD in exclusive users of Chinese cloth diapers. This observational study was conducted during a single home visit to 694 Chinese children who were exclusive users of cloth diapers in five inland cities of China. During each home visit, study nurses documented the presence and severity of DD using a visual dermatological scale and conducted transepidermal water loss (TEWL) and pH measurements. Diaper dermatitis was rare in the buttocks and genital area of the children (<20%) but was common in the perianal and intertriginous regions (50–70%). TEWL and pH were mildly higher in babies with DD than in those without DD in the genital and buttocks area. Diaper dermatitis is common in children who use traditional Chinese cloth diapers, especially in the perianal and intertriginous regions.