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Anemia remains one of the most intractable public health challenges in South Asia. This paper analyzes individual‐level and household‐level determinants of anemia among children and women in Nepal and Pakistan. Applying multivariate modified Poisson models to recent national survey data, we find that the prevalence of anemia was significantly higher among women from the poorest households in Pakistan (adjusted prevalence ratio [95% CI]: 1.10 [1.04–1.17]), women lacking sanitation facilities in Nepal (1.22 [1.12–1.33]), and among undernourished women (BMI < 18.5 kg/m2) in both countries (Nepal: 1.10 [1.00–1.21] and Pakistan: 1.07 [1.02–1.13]). Similarly, children in both countries were more likely to be anemic if stunted (Nepal: 1.19 [1.09–1.30] and Pakistan: 1.10 [1.07–1.14]) and having an anemic mother (Nepal: 1.31 [1.20–1.42] and Pakistan: 1.21 [1.17–1.26]). Policies and programs need to target vulnerable and hard‐to‐reach subpopulations who continue to bear a disproportionate burden of anemia. Covariates of poverty underpin rates of anemia among children and their mothers, but income growth alone will not suffice to resolve such deeply entrenched problems. Greater understanding of the relative role of various diet, health, sanitation, and educational factors by local context should guide investments to resolve anemia in tandem with stunting and maternal underweight. [ABSTRACT FROM AUTHOR]