Background: Jaundice is defined as yellowish discoloration of skin, sclera and mucous membrane. Neonatal hyperbilirubinemia is a common problem in the neonatal period occurring in nearly 5-25% neonates.Objective: To investigate the effect of Ursodeoxycholic acid in reducing unconjugated bilirubin levels of infants undergoing phototherapy for Neonatal hyperbilirubinemia. Methods: This study was a double blind, placebo controlled, randomized clinical trial conducted in the Department of Paediatrics, Santokba Durlabhji Memorial Hospital, Jaipur in active collaboration with Department of Ophthalmology, OBG and Pathology from January 2016 to June 2016. The 100 enrolled neonates were subdivided into two groups. Study Group: Patients in this group were administered oral Udcament suspension in a dose of 10mg/kg/day every 12 hourly till the serum bilirubin levels fell below 10mg/dl. Control Group: Patient in this group received placebo syrup in the form of sucrose solution in similar amounts 12 hourly till the serum bilirubin levels fell below 10 mg/dl. Results: The differences of mean STB between the two groups at admission, 12 ,24 ,36 and 48 hours was 0.72, 0.84 , 0.69 , 0.56 , and 0.51 respectively with a 95% CI of -0.16 to 1.12, 0.22 to 1.47 , -1.27 to -0.1, -0.99 to -0.14 and -0.9 to0.11 with the p value being 0.11, 0.008,0.02,0.01 and 0.01 .This indicates a positive effect of oral udcamentin reducing the levels of unconjugated bilirubin along with phototherapy.70 newborns were evaluated by fundus examination at the age of 6month & 12months. None of them was found any kind of ophthalmological abnormality. Conclusion: Addition of oral Ursodeoxycholic acid to phototherapy in neonates with indirect hyperbilirubunemia is more effective as compared to phototherapy alone in reducing serum bilirubin levels.