In 2007, Malawi became an early adopter of integrated community case management for childhood illnesses (iCCM), a policy aimed at community-level treatment for malaria, diarrhoea and pneumonia for children below 5 years. Through a retrospective case study, this article explores critical issues in implementation that arose during policy formulation through the lens of the innovation (i.e. iCCM) and of the institutions involved in the policy process. Data analysis is founded on a documentary review and 21 in-depth stakeholder interviews across institutions in Malawi. Findings indicate that the characteristics of iCCM made it a suitable policy to address persistent challenges in child mortality, namely that ill children were not interacting with health workers on a timely basis and consequently were dying in their communities. Further, iCCM was compatible with the Malawian health system due to the ability to build on an existing community health worker cadre of health surveillance assistants (HSAs) and previous experiences with treatment provision at the community level. In terms of institutions, the Ministry of Health (MoH) demonstrated leadership in the overall policy process despite early challenges of co-ordination within the MoH. WHO, United Nations Children’s Fund (UNICEF) and implementing organizations played a supportive role in their position as knowledge brokers. Greater challenges were faced in the organizational capacity of the MoH. Regulatory issues around HSA training as well as concerns around supervision and overburdening of HSAs were discussed, though not fully addressed during policy development. Similarly, the financial sustainability of iCCM, including the mechanisms for channelling funding flows, also remains an unresolved issue. This analysis highlights the role of implementation questions during policy development. Despite several outstanding concerns, the compatibility between iCCM as a policy alternative and the local context laid the foundation for Malawi’s road to early adoption of iCCM.