Traditional medicine is commonly assumed to be a crucial health care option for poor households in developing countries. However, little research has been done in Asia to quantify the reliance on traditional medicine and its determinants. This research contributes to filling in this knowledge gap using household survey data collected from 571 households in three rural and peri-urban sites in Nepal in 2012. Questions encompassed household socioeconomic characteristics, illness characteristics, and treatment-seeking behaviour. Treatment choice was investigated through bivariate analyses. Results show that traditional medicine, and especially self-treatment with medicinal plants, prevail as treatment options in both rural and peri-urban populations. Contrarily to what is commonly assumed, high income is an important determinant of use of traditional medicine. Likewise, knowledge of medicinal plants, age, education, gender and illness chronicity were also significant determinants. The importance of self-treatment with medicinal plants should inform the development of health policy tailored to people’s treatment-seeking behaviour.