Intraurban differentials in safe drinking water in developing cities have been exacerbated by rapid population growth that exceeds expansion of local water infrastructure. In Accra, Ghana, municipal water is rationed to meet demand, and the gap in water services is increasingly being filled by private water vendors selling packaged “sachet” water. Sachets extend drinking water coverage deeper into low-income areas and alleviate the need for safe water storage, potentially introducing a health benefit over stored tap water. We explore correlates of using sachets as the primary drinking water source for 2093 women in 37 census areas classified as slums by UN-Habitat, and links between sachet water and reported diarrhea episodes in a subset of 810 children under five. We find that neighborhood rationing exerts a strong effect on a household's likelihood of buying sachet water, and that sachet customers tend to be the poorest of the poor. Sachet use is also associated with higher levels of self-reported overall health in women, and lower likelihood of diarrhea in children. We conclude with implications for sachet regulation in Accra and other sub-Saharan cities facing drinking water shortages.