Allaying anxiety and providing calm children in the operating room is a challenging task for anesthesiologists. This study was designed to compare the use of nebulized dexmedetomidine and ketamine for premedication in pediatric patients under general anesthesia. Methods: Seventy patients, aged 2 to 8 years of both sexes, with American Society of Anesthesiologists physical status I/II scheduled for hernia repair surgery under general anesthesia, were randomized to two equal groups using a computer-generated random number table. Patients in group D received dexmedetomidine (2 µg/kg), and patients in group K received ketamine (2 mg/kg) by a jet nebulizer before the induction of anesthesia. The study’s primary objective was comparing the level of sedation, which was achieved at 30 min after a study drug administration using the Ramsay sedation scale, between the two groups. The secondary objectives were the two-group comparison of parental separation anxiety scale, acceptance of the mask, hemodynamic variables, recovery time, incidence of emergence agitation, and adverse events. Results: The median Ramsay sedation scale at 30 min was 3 (1–4) in group D and 3 (1–3) in group K (P = 0.002). Patients in group D had a more acceptable parental separation anxiety scale (P = 0.001) and a satisfactory mask acceptance scale (P = 0.042). Conclusions: Nebulized dexmedetomidine (2 µg/kg) provided better sedation along with smooth parental separation and satisfactory mask acceptance during induction of anesthesia with a similar emergence agitation profile and adverse reactions compared to nebulized ketamine in pediatric patients.