Diarrhea burden is often estimated using cross-sectional surveys. We measured variability in diarrhea prevalence among children < 5 years of age living in squatter settlements in central Karachi, Pakistan. We pooled data from non-intervention control households from studies conducted from 2002 through 2006. The prevalence of diarrhea varied on average by 29% from one week to the next, by 37% from one month to the next, and during peak diarrhea season by 32% from one year to the next. During 24 months when the same nine neighborhoods were under surveillance, each month the prevalence of diarrhea varied by at least an order of magnitude from the lowest to the highest prevalence neighborhood, and each neighborhood recorded the highest diarrhea prevalence during at least one month. Cross-sectional surveys are unreliable measures of diarrhea prevalence.