During a serious illness, even older children have a great need for their parents and can tolerate their absence only for short periods. Anxiety is the most commonly reported of these negative responses among children and high levels of anxiety can be harmful to child’s physiological and psychological health. To overcome the anxiety, play is an integral part of the hospitalized child’s plan of care. Play offers, the child an opportunity or creative expression, diversion and effective coping. The study aim was to assess and compare the level of anxiety after administration of play therapy among hospitalized children in experimental and control group and to determine the association of anxiety among hospitalized children with selected variables. In this study a Quantitative approach with True Experimental control post test design was used. Simple Random sampling technique was used to select the sample size of 60 children. Children were randomly allocated in experimental and control group. Data was collected from parents or care taker of children for control and experimental groups by using Hamilton Scale of anxiety. The study concluded that the mean anxiety score of children receiving play therapy during hospitalization was significantly less as compared to the mean anxiety score of control group. Therefore, play therapy while hospitalization was effective in reducing anxiety.