The aim of the study was to investigate the effect of antenatal iron-folic acid (IFA) supplementation on child stunting in Nepalese children age <2 years. A retrospective cohort study design was used, in which a pooled cohort of 5235 most recent live births 2 years prior to interview from three Nepal Demographic and Health Surveys (2001, 2006 and 2011) was analysed. The primary outcome was stunting in children age <2 years. The main exposure variable was antenatal IFA supplementation. Multivariate Poisson regression analysis was performed. In our sample, 31% and 10% of Nepalese children age <2 years were stunted and severely stunted, respectively. The adjusted relative risk of being stunted was 14% lower in children whose mothers used IFA supplements compared to those whose mothers did not use (aRR = 0.86, 95% CI = 0.77–0.97). Additionally, the adjusted relative risk of being stunted was significantly reduced by 23% when antenatal IFA supplementation was started ≤6 months with ≥90 IFA supplements used during pregnancy (aRR = 0.77, 95% CI = 0.64–0.92). Antenatal IFA supplementation significantly reduced the risk of stunting in Nepalese children age <2 years. The greatest impact on the risk reduction of child stunting was when IFA supplements were started ≤6 months with ≥90 supplements were used.