Background Pneumonia is the leading cause of mortality in under-five children and most of these deaths occur in South-East Asia and Africa. Fast breathing pneumonia if not treated can progress to lower chest indrawing pneumonia. Treatment recommendation by the World Health Organization (WHO) for fast-breathing pneumonia includes oral amoxicillin and cotrimoxazole (as an alternative). Due to limited access to health care facilities and skilled health care workers, many children are unable to receive antibiotics. Algorithm-based community case management of pneumonia through trained community health workers has resulted in a decline in morbidity and mortality in lowand middle-income countries (LMIC). Methods It was a cluster-randomized, unblinded, community-based trial conducted in the Matiari district of Sindh province, Pakistan. Lady Health Workers (LHWs) were trained in assessing, classifying, and managing fast-breathing pneumonia cases (Respiratory rate of >50 breaths/min) at home with oral amoxicillin for three days and with co-trimoxazole for five days in the intervention and control arms respectively. Children with fast-breathing pneumonia were screened by LHWs and were validated by the study by Community Health Workers (CHWs) within 48 hours. They were followed by the LHWs on days 2, 4, and 14 in intervention and on days 2, 6, and 14 in the control arm. Primary treatment failure was assessed on day 4 in intervention and day 6 in the control arm. A severe pneumonia trial was registered with ClinicalTrials.gov, number NCT01192789. Results From February 2008 to March 2010, a total of 5876 children were enrolled by Lady Health Workers as fast breathing pneumonia. On validation visits of the CHWs, 728 (12%) children were excluded. A total of 4984 children were analysed as per protocol: 2480 in intervention and 2504 in control. There were 72 (2.9%) primary treatment failures in the intervention arm as compared to 102 (4%) in the control arm with a risk difference of -0.94 (-2.84%, 0.96%). Secondary treatment failures were almost equal in both arms (4 vs 7 cases). No deaths or serious adverse events were recorded. Conclusions This study shows that amoxicillin can be as effective as cotrimoxazole to treat fast-breathing pneumonia cases at the domiciliary level.