Microchannel heat sinks are potential devices that remove heat flux from high power density miniaturized electronic components. While the large surface-area-to-volume ratio and high heat transfer coefficient are the key features rendering benefits, the small flow rate and short channel lengths alongside high solid cross section to fluid free flow area make them susceptible to intense axial conduction loss. The conventional models for macrodevices based on the one-dimensional energy equation are often inappropriate in the microdomain. A novel multidimensional analytical model (capable of capturing axial heat transfer in microchannel heat sinks) has been used to study the thermal performance over a varied range of geometric and flow parameters. The effect of axial conduction has been seen in the solid–fluid temperature profiles, interfacial flux distribution and the average amount of heat transferred axially. The results indicate a skewed flux distribution at the fluid–solid interface leading to nonlinear temperature variation when axial conduction is dominant. Moreover, it has been shown that nonlinearity in the fluid temperature introduces significant errors in experimental data reduction, leading to apparently very low Nusselt number estimation. Moreover, this erroneous data interpretation is also linked to the prediction of a strong Reynolds number dependency of the average Nusselt number in the laminar flow regime.