Biomass fuel burning leads to high levels of suspended particulate matter and hazardous chemicals in the indoor environment in countries where it is in common use, contributing significantly to indoor air pollution (IAP). A situational analysis of household energy and biomass use and associated health effects of IAP was conducted by reviewing published and un-published literature about the situation in Pakistan. In addition to attempt to quantify the burden of ill health due to IAP, this paper also appraises the mitigation measures undertaken to avert the problem in Pakistan. Unfortunately, IAP is still not a recognized environmental hazard in Pakistan and there are no policies and standards to control it at the household level. Only a few original studies related to health effects of IAP have been conducted, mainly on women’s health and birth outcome, and only a few governmental, non-governmental and academic institutions are working to improve the IAP situation by introducing improved stoves and renewable energy technology at a small scale. Control of IAP health hazards in Pakistan requires an initial meeting of the stakeholders to define a policy and an action agenda. Simultaneously, studies gathering evidence of impact of intervention through available technologies such as improved stoves would have favorable impact on the health, especially of women and children in Pakistan.