Background Respiratory viral infections follow an unpredictable clinical course in young children ranging from a common cold to respiratory failure. The transition from mild to severe disease occurs rapidly and is difficult to predict. The pathophysiology underlying disease severity has remained elusive. There is an urgent need to better understand the immune response in this disease to come up with biomarkers that may aid clinical decision making. Methods In a prospective study, flow cytometric and genome-wide gene expression analyses were performed on blood samples of 26 children with a diagnosis of severe, moderate or mild Respiratory Syncytial Virus (RSV) infection. Differentially expressed genes were validated using Q-PCR in a second cohort of 80 children during three consecutive winter seasons. FACS analyses were also performed in the second cohort and on recovery samples of severe cases in the first cohort. Results Severe RSV infection was associated with a transient but marked decrease in CD4+ T, CD8+ T, and NK cells in peripheral blood. Gene expression analyses in both cohorts identified Olfactomedin4 (OLFM4) as a fully discriminative marker between children with mild and severe RSV infection, giving a PAM cross-validation error of 0%. Patients with an OLFM4 gene expression level above -7.5 were 6 times more likely to develop severe disease, after correction for age at hospitalization and gestational age. Conclusion By combining genome-wide expression profiling of blood cell subsets with clinically well-annotated samples, OLFM4 was identified as a biomarker for severity of pediatric RSV infection.