Introduction. Early diagnosis and treatment of neonatal sepsis may help decrease neonatal mortality. Aim of the Study. To evaluate the role of pancreatic stone protein as a marker for early onset neonatal sepsis. Methods. A hospital-based prospective study was conducted on 104 (52 uninfected and 52 infected neonates) admitted to the Neonatal Intensive Care Unit (NICU) of Zagazig University hospitals during the period from April 2014 to April 2015. All newborns were subjected to full history taking, careful neonatal assessment, blood, C-reactive protein (CRP), and serum pancreatic stone protein. Results. Serum PSP levels were significantly higher in the infected group than in the uninfected group. At a cutoff level of PSP 12.96 ng/mL, the sensitivity was 96.2%, the specificity was 88.5%, positive predictive value was 95.8%, negative predictive value was 89.3%, and area under the curve was 0.87. A significant positive correlation between CRP and PSP was found in infected group. Conclusion. The high negative predictive value of PSP (89.3%) indicates that the serum PSP level is a good marker for diagnosis of early onset neonatal sepsis and can be used to limit hospital stay and antibiotic use in neonates treated for suspected sepsis.