<b>Background:</b> Proper umbilical cord care prevents neonatal infections and reduces neonatal mortality. Despite global recommendations for evidence-based cord care practices, traditional beliefs, and inadequate maternal knowledge often lead to unsafe practices, particularly in low-resource settings like Bangladesh. This study aimed to assess the understanding of umbilical cord care among mothers of neonates in Sherpur District, Bangladesh, and identify factors associated with knowledge levels. <b>Methods:</b> A descriptive cross-sectional study was conducted from July to October 2020 at Sherpur Sadar Hospital. A total of 193 mothers of neonates were recruited using a non-randomized purposive sampling method. Data was collected through a pre-tested, semi-structured, interviewer-administered questionnaire. Knowledge levels were categorized as "Good" (>6) or "Poor" (≤6) based on responses to 10 structured questions. Statistical analyses, including chi-square tests and crude odds ratios (COR), were performed to identify socio-demographic factors associated with knowledge levels. <b>Results:</b> Of the 193 participants, 48.7% demonstrated "Good" knowledge, while 51.3% had "Poor" knowledge. Education level (p = 0.01), occupation (p = 0.02), family type (p < 0.001), and family size (p = 0.04) were significantly associated with knowledge levels. Mothers with higher education and those from joint families exhibited better knowledge. However, 28.5% of respondents were unaware of the typical umbilical cord-shedding timeframe, and 44% could not identify signs of infection. Unsafe practices, such as using medications (14.5%) or hot compression (7.2%) for drying the cord, were reported. <b>Conclusion:</b> The study reveals significant gaps in maternal knowledge regarding umbilical cord care in Sherpur District, driven by socio-demographic disparities and cultural practices. Targeted health education programs, emphasizing evidence-based cord care practices and leveraging local social structures, are urgently needed to improve neonatal health outcomes in similar resource-limited settings. Future research should evaluate the effectiveness of these interventions to inform policy and practice.