Abstract Background The protective effect of insecticide-treated bed nets against individual-level malaria transmission is well known, however community-level effects are less understood. Protective effects from community-level bed net use against malaria transmission have been observed in clinical trials, however, the relationship is less clear outside of a controlled research setting. The objective of this research was to investigate the effect of community-level bed net use against malaria transmission outside of a bed net clinical trial setting in Lilongwe, Malawi following national efforts to scale-up ownership of long-lasting, insecticide-treated bed nets. Methods An annual, cross-sectional, household-randomized, malaria transmission intensity survey was conducted in Lilongwe, Malawi (2011–2013). Health, demographic, and geographic-location data were collected. Participant blood samples were tested for Plasmodium falciparum presence. The percentage of people sleeping under a bed net within 400-m and 1-km radii of all participants was measured. Mixed effects logistic regression models were used to measure the relationship between malaria prevalence and surrounding bed net coverage. Each year, 800 people were enrolled (400 <5 years; 200 5–19 years; 200 ≥20 years; total n = 2400). Results From 2011 to 2013, malaria prevalence declined from 12.9 to 5.6%, while bed net use increased from 53.8 to 78.6%. For every 1% increase in community bed net coverage, malaria prevalence decreased among children under 5 years old [adjusted odds ratio: 0.98 (0.96, 1.00)]. Similar effects were observed in participants 5–19 years [unadjusted odds ratio: 0.98 (0.97, 1.00)]; the effect was attenuated after adjusting for individual-level bed net use. Community coverage was not associated with malaria prevalence among adults ≥20 years. Supplemental analyses identified more pronounced indirect protective effects from community-level bed net use against malaria transmission among children under 5 years who were sleeping under a bed net [adjusted odds ratio: 0.97 (0.94, 0.99)], compared to children who were not sleeping under a bed net [adjusted odds ratio: 0.99 (0.97, 1.01)]. Conclusions Malawi’s efforts to scale up ownership of long-lasting, insecticide-treated bed nets are effective in increasing reported use. Increased community-level bed net coverage appears to provide additional protection against malaria transmission beyond individual use in a real-world context.