This study explores the clinical efficacy of budesonide combined with ambroxol inhalation therapy for neonatal pneumonia. A total of 68 neonatal pneumonia patients treated at Li County Hospital from January 2023 to December 2024 were randomly divided into a monotherapy group and a combination group, with 34 patients in each. The monotherapy group received ambroxol inhalation therapy, while the combination group received budesonide inhalation therapy in addition to ambroxol. The recovery progress, blood gas analysis indicators, inflammatory response improvement, and overall clinical efficacy were compared between the two groups. Results showed that the combination group experienced a significantly shorter time for body temperature normalization (3.36 ± 0.58 days vs. 4.59 ± 0.45 days), oxygen inhalation duration (4.89 ± 0.57min vs. 6.96 ± 0.79min), disappearance of shortness of breath and cough (4.56 ± 0.29 days vs. 6.63 ± 0.75 days), and resolution of lung wet rales (5.62 ± 1.46 days vs. 7.92 ± 1.28 days) compared to the monotherapy group (P < 0.05). Additionally, the total effective rate was significantly higher in the combination group (97.06%) than in the monotherapy group (73.52%) (P<0.05). Post-treatment, the combination group exhibited significantly better blood gas analysis and inflammatory response indicators (P<0.05). These findings suggest that budesonide combined with ambroxol inhalation therapy can effectively improve blood oxygen saturation, reduce inflammation, promote faster recovery, and enhance overall clinical efficacy, making it a reliable treatment option for neonatal pneumonia.