We studied changes in species distribution and antimicrobial resistance patterns of Shigella during 1980–2008, using the Diarrhoeal Diseases Surveillance system of Dhaka Hospital of ICDDR,B. In hospitalized patients Shigella prevalence decreased steadily from 8–12% in the 1980s to 3% in 2008. Endemic S. flexneri was the most commonly isolated species (54%). Epidemic S. dysenteriae type 1 had two peaks in 1984 and 1993, but was not found after 2000, except for one case in 2004. The therapeutic options are now limited: in 2008 a total of 33% of S. flexneri were resistant to ciprofloxacin and 57% to mecillinam. In the <5 years age group, severely underweight, wasted and stunted children were more at risk of shigellosis compared to well-nourished children (P<0·001). Although hospitalization for Shigella diarrhoea is decreasing, the high levels of antimicrobial resistance and increased susceptibility of malnourished children continue to pose an ongoing risk.