Effects of the distribution in space of permethrin (insecticide)-impregnated bed nets (IIBNS) on child mortality were studied in a randomized controlled trial of IIBNs in a an area highly endemic for Plasmodium falciparum malaria in rural northern Ghana. Eight hundred sixty-two deaths occurred among children 6-59 months of age during 16,841 child-years-at-risk. Mortality increased with the distance from health facilities but not with proximity to identifiable anopheline breeding sites (reservoirs). The efficacy of IIBNs was independent of these distances. Mortality in users of IIBNs was independent of the proximity of nonusers, and mortality rates of nonusers and users living close to each other were similar. Poisson regression estimated a 6.7% increase in mortality among nonusers with each 100-m shift away from the nearest compound with IIBNS, indicating that the insecticide protects nearby nonusers. High coverage of IIBNs achieves maximum impact, but users of IIBNs offer some protection to less fortunate neighbors if coverage is incomplete.