Implementing an appropriate drug dispensing system in hospitals is essential to ensure the safe and rational use of drugs. This study aimed to assess the unit-dose drug dispensing system (DDS) and the ward-stock DDS utilized in Gaza hospitals to ascertain which system is more beneficial. The quantitative, comparative cross-sectional design utilized structured interviews with pharmacists and head nurses, missing drug registration sheets and drug administration observation checklists. The number of missing units per drug item dispensed (mean 3.4 and 1.8 respectively) and medication administration errors per patient (mean 1.8 and 0.9 respectively) were statistically significantly lower in the hospital using the unit-dose DDS than the ward-stock DDS. The unit-dose DDS appeared to be safer, with fewer missing drugs, was more positively perceived by staff and was more supportive of good clinical pharmacy practice. Its use in other hospitals in the Gaza Strip is recommended.