The high level of ambient particulate matter in many developing countries constitutes a major health burden, but evidence on its impact on children’s health is still limited in these regions. We conducted a time-stratified case-crossover analysis to quantify the short-term association between fine particulate matter (PM2.5) and hospital admissions due to acute respiratory infections (ARI) among children in Bhaktapur district, Nepal, and to investigate the potential modification of the effect by nutritional characteristic. We analyzed 258 children admitted to the pediatric hospital for ARI between February 2014 to February 2015. We observed evidence of increased risk on the same (lag 0) and preceding day (lag 1). The cumulative estimate of their average (lag 01) suggested each 10 μg/m3 increase in PM2.5 was associated with a relative risk (RR) of 1.16 (95% confidence interval [CI]: 1.02–1.31). The strongest evidence from a stratified analysis of three categories of weights was observed in the overweight group (RR: 1.77; 95% CI: 1.17–2.69) at lag 01, while the estimates for the normal weight and underweight groups were closer to the non-stratified estimates for all-ARI cases. The findings suggests that pediatric ARI is an important morbidity associated with inhalable PM2.5 and that more research is needed to elucidate and validate the observed dissimilarity by weight.