Medication errors account for about 78% of serious medical errors in intensive care unit (ICU). So far no study has been performed in Iran to evaluate all type of possible medication errors in ICU. Therefore the objective of this study was to reveal the frequency, type and consequences of all type of errors in an ICU of a large teaching hospital. The prospective observational study was conducted in an 11 bed internal ICU of a university hospital in Shiraz. In each shift all processes that were performed on one selected patient was observed and recorded by a trained pharmacist. Observer would intervene only if medication error would cause substantial harm. The data was evaluated and then were entered in a form that was designed for this purpose. The study continued for 38 shifts. During this period, a total of 442 errors per 5785 opportunities for errors (7.6%) occurred. Of those, there were 9.8% administration errors, 6.8% prescribing errors, 3.3% transcription errors and, 2.3% dispensing errors. Totally 45 interventions were made, 40% of interventions result in the correction of errors. The most common causes of errors were observed to be: rule violations, slip and memory lapses and lack of drug knowledge. According to our results, the rate of errors is alarming and requires implementation of a serious solution. Since our system lacks a well-organize detection and reporting mechanism, there is no means for preventing errors in the first place. Hence, as the first step we must implement a system where errors are routinely detected and reported.