Children’s living arrangement plays a crucial role on their physical, emotional as well as social development. This study aimed to examine the living arrangement of children (both orphan & non-orphan) based on a nationally representative Nepal Demographic and Health Survey (NDHS) 2006 and 2011. This study used total sample of 0-17 years children consist of 19 935 and 20 808 respectively in 2006 and 2011 survey. The survey package in statistical software R was used to analyze the data. Chi-square test and logistic regression model were employed as statistical tools. Of the total children, 5% (95% CI, 4.7-6.0) in 2006 and 5.3% (95% CI, 4.5-5.5) in 2011were orphans. The number of paternal orphans almost doubled the number of maternal orphans in both surveys. Furthermore, approximately 7% (95% CI, 6.2-8.1) of the children lived apart from their biological parents in both surveys. This study also found that about one quarter of the children, representing 23.5% (95% CI, 21.4-25.7) in 2006 and 28.7% (95% CI, 26.8-30.6) in 2011 were living only with their biological mother. The multivariate analysis found that orphans were more likely to reside in poorest households, in households having no or unrelated adult, in female headed and more than50 year age group headed households. In conclusion, the proportion of children living with both parents had slightly decreased, whereas those living with mother had slightly increased over the time. The living arrangement in relation to household level characteristics between orphans and non-orphans was significantly varied.