An anti-rash diaper for preventing and treating diaper rash and skin irritations comprising: an absorbent layer, where the absorbent layer draws moisture; medicated ointment, where the ointment is applied over the absorbent layer; and a protective sheet, where the protective sheet is releasably attached over the ointment. The anti-rash diaper according to the present invention may further include elastic waistbands. A hook and loop fastener may be used to attach the protective sheet to the diaper. The protective sheet effectively secures the ointment over the absorbent layer.