Background Urinary tract infection (UTI) is one of the most common bacterial infections in childhood and is associated with long-term complications. We aimed to assess the effect of adjuvant dexamethasone treatment on reducing kidney scarring after acute pyelonephritis (APN) in children. Methods Multicenter, prospective, double-blind, placebo-controlled, randomized clinical trial (RCT) where children from 1 month to 14 years of age with proven APN were randomly assigned to receive a 3-day course of either an intravenous corticosteroid (dexamethasone 0.30 mg per kg/day) twice daily or placebo. The late technetium 99 m-dimercaptosuric acid scintigraphy (> 6 months after acute episode) was performed to assess kidney scar persistence. Kidney scarring risk factors (vesicoureteral reflux, kidney congenital anomalies, or urinary tract dilatation) were also assessed. Results Ninety-one participants completed the follow-up and were finally included (dexamethasone n  = 49 and placebo n  = 42). Both groups had similar baseline characteristics. Twenty participants showed persistent kidney scarring after > 6 months of follow-up without differences in incidence between groups (22% and 21% in the dexamethasone and placebo groups, p  = 0.907). Renal damage severity in the early DMSA (β = 0.648, p  = 0.023) and procalcitonin values (β = 0.065 p  = 0.027) significantly modulated scar development. Vesicoureteral reflux grade showed a trend towards significance (β = 0.545, p  = 0.054), but dexamethasone treatment showed no effect. Conclusion Dexamethasone showed no effect on reducing the risk of scar formation in children with APN. Hence, there is no evidence for an adjuvant corticosteroid treatment recommendation in children with APN. However, the study was limited by not achieving the predicted sample size and the expected scar formation. Trial registration Clinicaltrials.gov, NCT02034851. Registered in January 14, 2014. Graphical abstract “A higher resolution version of the Graphical abstract is available as Supplementary information.”