The primary purpose of this paper was to develop and evaluate a physiologically based system for the identification of acutely ill children in hospital environments. The dependency of children in hospital is increasing and ensuring the appropriate and timely intervention by a team of health personnel experienced in the care of these children is paramount to ensure their optimal outcome. A paediatric early warning (PEW) tool was designed and demographic and physiological data collected on all children (n = 360) who triggered the tool over a 6-month period, between September 2003 and February 2004. Analysis of the data was undertaken on each criterion within the tool and by reviewing it against patient outcome, the decision for its retention or removal was made. The modified tool showed a 99% sensitivity and a 66% specificity. The resultant Paediatric Early Warning Tool has been validated for use in a tertiary children's hospital in the United Kingdom (UK). The use of such a tool by all staff caring for acutely ill children in hospital environments can help to ensure their early recognition and timely treatment. The tool together with an action plan must, however, be appropriate for use in individual ward or hospital areas.