Background: Although rapid diagnostic tests (RDTs) have practical advantages over light microscopy (LM) and goodsensitivity in severe falciparum malaria in Africa, their utility where severe non-falciparum malaria occurs is unknown. LM,RDTs and polymerase chain reaction (PCR)-based methods have limitations, and thus conventional comparative malariadiagnostic studies employ imperfect gold standards. We assessed whether, using Bayesian latent class models (LCMs) whichdo not require a reference method, RDTs could safely direct initial anti-infective therapy in severe ill children from an area ofhyperendemic transmission of both Plasmodium falciparum and P. vivax.Methods and Findings: We studied 797 Papua New Guinean children hospitalized with well-characterized severe illness forwhom LM, RDT and nested PCR (nPCR) results were available. For any severe malaria, the estimated prevalence was 47.5%with RDTs exhibiting similar sensitivity and negative predictive value (NPV) to nPCR ($96.0%). LM was the least sensitive test(87.4%) and had the lowest NPV (89.7%), but had the highest specificity (99.1%) and positive predictive value (98.9%). Forsevere falciparum malaria (prevalence 42.9%), the findings were similar. For non-falciparum severe malaria (prevalence6.9%), no test had the WHO-recommended sensitivity and specificity of .95% and .90%, respectively. RDTs were the leastsensitive (69.6%) and had the lowest NPV (96.7%).Conclusions: RDTs appear a valuable point-of-care test that is at least equivalent to LM in diagnosing severe falciparummalaria in this epidemiologic situation. None of the tests had the required sensitivity/specificity for severe non-falciparummalaria but the number of false-negative RDTs in this group was small.