Anxiety disorders are common disorders in childhood, and developmental differences must be considered when diagnosing and treating patients in this age group. Recent research has illuminated the course of childhood anxiety disorders, including how they can be precursors to continued anxiety and mood problems in adulthood. Recent studies of cognitive-behavioral therapy, the first-line psychosocial treatment for childhood anxiety, have focused on the following issues: the relative efficacy of group versus individual cognitive-behavioral therapy; the role of parent involvement; and the application of specific techniques to certain diagnostic groups (eg, social skills techniques in social phobia). Selective serotonin reuptake inhibitors have been associated with high acute response rates in controlled studies of children with anxiety disorders, and more recent evidence suggests they are efficacious and well tolerated when taken for longer periods. This article will review significant diagnostic and developmental issues, and highlight recent studies in psychosocial and pharmacologic therapies of pediatric anxiety disorders.