Recently, the FDA has encouraged testing of medications among pediatric patients during drug development. Pharmaceutical companies have responded by conducting more clinical trials among children, and researchers are becoming aware of the unique challenges of assessing pediatric health outcomes, including health-related quality of life (HRQL). Like adults, children experience effects of illness and treatment beyond physiologic outcomes. Further pediatric HRQL research is necessary to examine these broader psychosocial outcomes and provide a thorough understanding of the effects of treatment on children's health status. The purpose of the current review is to discuss key regulatory and methodologic developments and provide guidance for future research on pediatric HRQL. This review of pediatric HRQL assessment includes five sections: 1) recent pediatric regulatory developments in the United States; 2) issues in defining and conceptualizing pediatric HRQL, including the importance of contextual variables such as family and peer systems; 3) methodologic issues (e.g., the proxy question, developmental differences, response sets) with recommendations for addressing these issues in clinical trials; 4) validated generic and condition-specific pediatric HRQL measures; and 5) a recommendation for additional research on the HRQL impact of childhood psychiatric disorders. It is advocated that assessment of HRQL among children should be conducted regularly as an integral part of drug development.