The number of boys and girls under 5 who die annually has dropped from 12 million in 1990 to 7.6 million in 2010, UNICEF and the World Health Organisation say in a new report.
The two UN agencies estimate in the report released on Thursday that the drop means that about 12,000 more children's lives are being saved each day.
They said there are many reasons for the improved under-5 mortality rate, including better access to health care and preventive measures such as immunisation.
But while the numbers are positive, the agencies say more must be done for the world's nations to reach U.N. development goals that call for lowering the under-5 mortality rate by two-thirds from its 1990 levels by 2015.
"Focusing greater investment on the most disadvantaged communities will help us save more children's lives, more quickly and more cost effectively," said Anthony Lake, UNICEF Executive Director.
"The news that the rate of child mortality in sub-Saharan Africa is declining twice as fast as it was a decade ago shows that we can make progress even in the poorest places," said Lake. "But we cannot for a moment forget the chilling fact of around 21,000 children dying everyday from preventable causes."
The release of the report comes before next week's annual meeting of world leaders for the new session of the U.N. General Assembly.