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Increased diarrheal episode severity has been linked to better 2-week recall and improved care-seeking and treatment among caregivers of children under five. Using cross-sectional data from three Indian states, we sought to assess the relationship between episode severity and the recall, care-seeking, and treatment of childhood diarrhea. Recall error was higher for episodes with onset 8–14 days (31.2%) versus 1–7 days (4.8%) before the survey, and logistic regression analysis showed a trend toward increased severity of less recent compared with more recent episodes. This finding indicates that data collection with 2-week recall underestimates diarrhea prevalence while overestimating the proportion of severe episodes. There was a strong correlation between care-seeking and dehydration, fever, vomiting, and increased stool frequency and duration. Treatment with oral rehydration salts was associated with dehydration, vomiting, and higher stool frequency, and trends were established between therapeutic zinc supplementation and increased duration and stool frequency. However, state and care-seeking sector were stronger determinants of treatment than episode severity, illustrating the need to address disparities in treatment quality across regions and delivery channels. Our findings are of importance to researchers and diarrhea management program evaluators aiming to produce accurate estimates of diarrheal outcomes and program impact in low- and middle-income countries.