Margosa Oil is an extract of the seed of the Neem tree and is widely used as a traditional medicine by Indians in India, Sri Lanka, Burma, Thailand, Malaysia and Indonesia. Used mainly for external applications, it is often administered orally to neonates and infants regularly in small amounts. Margosa Oil causes toxic encephalopathy particularly in infants and young children. The usual features are vomiting, drowsiness, tachypnea and recurrent generalised seizures. Leucocytosis and metabolic acidosis are significant laboratory findings. Management is aimed primarily towards the control of convulsions although supportive management is equally important. Prognosis is usually good but fatalities and neurological deficits have been reported. We report here two infants with Margosa Oil poisoning presenting with encephalopathy.