Background: Caring for the sick newborn in a developing setting is very challenging. Apart from the medical facilities and expertise of the medical team, other factors such as the ability of the caregiver to adapt to the financial, economic, and psychosocial demands associated with the illness process also determine survival. This study explored the psychosocial burden of caregivers and its related factors in a developing setting. Methodology: This cross-sectional and analytical study was carried out prospectively over an 18-month period at the Special Care Baby Unit of Enugu State University Teaching Hospital. Caregivers who consented were consecutively enrolled. IBM SPSS version 20 was used for data analysis and statistical significance was set at P ≤ 0.05. Results: There was a wide range of psychosocial burden experienced by caregivers during the admission period of the sick newborn. The most common encountered psychological burden included catastrophic economic sacrifice because of baby's ill health (40.0%), worry about not giving the baby the best care (39.7%), feeling of loneliness and isolation (39.5%), tiredness and constant feeling of been worn out (34.6%), and limitation on one's own social life (32.8%). Several factors such as place of birth, educational level of the caregiver, previous preterm baby in the family, length of stay in hospital, number of additional children to look after, and the birth weight of the baby were predictive factors of degree of psychosocial burden faced by caregivers. Conclusion: Caregivers of sick newborn experience significant levels of psychological burden with considerate impact on the care and outcome of newborns. Comprehensive sick newborn care should envisage and incorporate the management of different domains of stressors among caregivers.