Background: Posterior malleolar fragment (PMF) occurs in 7–44% of all ankle fractures. The integrity of the posterior malleolus and its ligamentous attachments is important for tibiotalar load transfer, posterior talar stability, and rotatory stability. No consensus exists on the minimum size of PMF that requires fixation. The purpose of this study is to investigate biomechanically the effect of fixing small PMF (<25% of tibial plafond) and its effect on ankle stability. Materials and methods: A total of 22 cadaveric ankle specimens were studied. They were divided into three groups according to the percentage of osteotomy performed—group I (20–30% of articular surface), group II (30–40%), and group III (40–50%). Ankles were subjected to axial loading using an indigenously developed machine with serial monitoring, load at which the fragment displacement, or posterior talar subluxation happened was noted. Internal fixation of fragment was done according to Arbeitsgemeinschaft für Osteosynthesefragen (AO) principles and subjected to load to check for fragment displacement or posterior talar subluxation. Results: The mean prefixation load which caused the posterior talar subluxation or the fragment displacement was lower (507.60 ± 104.99 N) in group III compared to group I (1156.00 ± 172.15 N). The mean postfixation load was 1882.88 ± 75.59, 1739.00 ± 109.03, and 1313.60 ± 356.00 N in groups I, II, and III, respectively. The mean difference in load (postfixation minus prefixation) in group I was 742.44 ± 133.98, 996.00 ± 108.23 N in group II, and 806.00 ± 257.08 N in group III. The difference in prefixation and postfixation load was statistically significant in all the three groups with p-value of <0.001. Conclusion: Fixation of PMF, irrespective of the size or percentage of articular surface involvement, leads to better ankle stability. Clinical significance: Fixation of small PMF (<25% of the articular surface) will lead to better ankle stability and early rehabilitation.