Deep palmar space infection is a rare but potentially serious condition in neonates that requires prompt diagnosis and management. We present the case of a neonate who developed a deep palmar space infection on day two of life. The neonate presented with swelling, erythema, tenderness, and limited movement of the affected hand. The diagnosis was confirmed with imaging using ultrasound, which revealed evidence of fluid collection suggestive of an abscess. Surgical drainage of the abscess and appropriate antibiotic therapy resulted in a successful outcome with complete resolution of symptoms and recovery of hand function. This case highlights the importance of early recognition, appropriate diagnostic workup, and prompt surgical intervention for deep palmar space infection in neonates to prevent complications and achieve favourable outcomes. Additionally, infection prevention measures such as maintaining strict aseptic techniques during invasive procedures in neonates should be emphasised to prevent similar infections in the future.