OBJECTIVE Midazolam has been the most popular oral premedicant in children despite its side effects. Dexmedetomidine with its favorable clinical profile is a suitable alternative, but with limited research. The aim of this study was to compare the effectiveness of dexmedetomidine and midazolam as oral premedicants in children. METHODS Eighty children of the American Society of Anesthesiologist physical status I scheduled for elective herniotomy were included in this prospective randomized double-blind study. Patients were randomly assigned to receive either dexmedetomidine 4 μg/kg (Group A, n = 40) or midazolam 0.5 mg/kg (Group B, n = 40) orally 40 min before induction. Pre-operative sedation, response to parental separation and venepuncture, emergence agitation, recovery nurse satisfaction, and side effects were compared between the two groups. Quantitative data were compared using unpaired Student's t-test and categorical variables with Chi-square test. RESULTS Pre-operative sedation and response to parental separation and venepuncture were similar between the two groups. Group A had a significantly lower incidence and severity of emergence agitation (P = 0.000). Recovery nurse satisfaction was significantly higher in Group A (P = 0.002). However, incidence of hypotension and bradycardia was found to be more in Group A (P = 0.04). CONCLUSIONS Premedication with oral dexmedetomidine is as effective as oral midazolam in providing sedation and anxiolysis in children. Dexmedetomidine in addition reduces the incidence and severity of emergence agitation.