This is a randomized community trial which was carried out to compare the relative effectiveness of three modes of ORT in under-5 children with acute diarrhea; to identify the factors associated with compliance and to assess mother's perception of ORTS. The three ORTS were GORS(n=98), prepacked CBORS (n=90), and home made CBORT (n=103). These alternative ORT therapies were compared in terms of mean weight gain and frequency and duration of diarrhea. The CBORT group was equal to or better than the GORS or CBORS in terms of mean weight gain at 24, 48, 72, and 96 hrs following the onset of treatment. The mean frequency and duration of diarrhea were significantly higher in the GORS group. Increased feeding frequency was associated significantly with higher mean weight gain. Mothers' compliance and child acceptability were higher in CBORT when compared to GORS children and similar to the CBORS children. Mothers' perceptions of ORT as "food and medicine" was found to be an important factor associated positively with caretakers' ORT compliance and child weight gain. This study suggests that beliefs of causation might influence mothers' compliance. It is concluded that home-made CBORT is as effective as GORS or CBORS and more acceptable in the treatment of ACD. The implementation of well monitored, community based CBORT programs in Ethiopia are recommended.