Numerous studies have investigated the application of multi-zone demand-controlled ventilation for office buildings. However, although Swedish regulations allow ventilation rates in residential buildings to be decreased by 70 % during non-occupancy, this system is not very common in the sector. The main focus of the present study was to experimentally investigate the indoor air quality and energy consumption when using multi-zone demand-controlled ventilation in a residential building. The building studied was located in Borlänge, Sweden. This building was recently renovated with better windows with low U values, together with internally-added insulation materials. The building had natural ventilation, which decreased significantly after retrofitting and resulted in poor indoor air quality. Therefore, a controllable mechanical ventilation system was installed. The ventilation rate was controlled according to the demand in each zone of the building by CO2 concentration as an indicator of indoor air quality in habitable spaces and relative humidity and VOC level in the toilet and bathroom. The study showed that multi-zone demand-controlled ventilation significantly reduced the CO2 concentration leading to improvement in indoor air quality. However, building with demand-controlled ventilation consumed more energy than natural ventilation as it increases the ventilation loss by forcing more air into the building. Nevertheless, in the demand-controlled ventilation system, the energy consumption for the ventilation fan and ventilation loss was almost half of the constant high rate ventilation flow.