Young children are at greatest risk of exposure to lead and its effects. Although lead is one of the most widely used elements with known health hazard, there is little data on the blood lead level (BLL) of children in the Kathmandu Valley. Thus, this study aimed to assess factors associated with high BLL in children who were 6-36 months of age and resided in the Kathmandu Valley. In this hospital-based cross-sectional study 6-36 month-old children visiting the Paediatrics Outpatient Department of Tribhuvan University Teaching Hospital, Patan Hospital, and Siddhi Memorial Hospital were enrolled. All three hospitals are located in different areas inside the Kathmandu Valley. Written informed consent was obtained from the parents, and exposure data were collected using a structured questionnaire. Portable Anodic Stripping Voltammetry (ASV) was used to determine BLLs in children. Data were analyzed using SPSS version 16. Of 312 children enrolled in the study, 64.4% had BLLs ≥5μg/dl. A significant association was found between BLL and exposure to enamel paints in the household in the form of painting materials used in different parts of the house like walls, windows and doors (p = 0.001). Furthermore, multivariate analyses showed that BLLs were 4.5 times higher in children playing with dirt and dust (p = 0.006) and that children belonging to the community of lower caste/ethnicity groups had significantly higher BLLs compared to those from the upper caste groups (p = 0.02). Our study demonstrated that children living in households that have used enamel paints, children belonging to lower caste/ethnic groups, and children frequently playing with dirt and dust had significantly higher BLLs. The results of this study highlight the importance of policy decisions to limit environmental lead contamination, and to roll out awareness building measures designed to limit lead exposure and break the poverty cycle associated with chronic lead poisoning.