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Background: Neonatal mortality accounts for almost 40 per cent of under-five child mortality, globally. An understanding of the factors related to neonatal mortality is important to guide the development of focused and evidence-based health interventions to prevent neonatal deaths. This study aimed to identify the determinants of neonatal mortality in Indonesia, for a nationally representative sample of births from 1997 to 2002. Methods: The data source for the analysis was the 2002-2003 Indonesia Demographic and Health Survey from which survival information of 15,952 singleton live-born infants born between 1997 and 2002 was examined. Multilevel logistic regression using a hierarchical approach was performed to analyze the factors associated with neonatal deaths, using community, socio-economic status and proximate determinants. Results: At the community level, the odds of neonatal death was significantly higher for infants from East Java (OR = 5.01, p = 0.00), and for North, Central and Southeast Sulawesi and Gorontalo combined (OR = 3.17, p = 0.03) compared to the lowest neonatal mortality regions of Bali, South Sulawesi and Jambi provinces. A progressive reduction in the odds was found as the percentage of deliveries assisted by trained delivery attendants in the cluster increased. The odds of neonatal death were higher for infants born to both mother and father who were employed (OR = 1.84, p = 0.00) and for infants born to father who were unemployed (OR = 2.99, p = 0.02). The odds were also higher for higher rank infants with a short birth interval (OR = 2.82, p = 0.00), male infants (OR = 1.49, p = 0.01), smaller than average-sized infants (OR = 2.80, p = 0.00), and infant's whose mother had a history of delivery complications (OR = 1.81, p = 0.00). Infants receiving any postnatal care were significantly protected from neonatal death (OR = 0.63, p = 0.03). Conclusion: Public health interventions directed at reducing neonatal death should address community, household and individual level factors which significantly influence neonatal mortality in Indonesia. Low birth weight and short birth interval infants as well as perinatal health services factors, such as the availability of skilled birth attendance and postnatal care utilization should be taken into account when planning the interventions to reduce neonatal mortality in Indonesia. [ABSTRACT FROM AUTHOR]