Interstitial lung disease in children is a heterogeneous group of disorders of both known and unknown causes that share a common histologic characteristic (i.e., inflammation of the pulmonary interstitium that may resolve completely, partially, or progress to derangement of alveolar structures with varying degrees of fibrosis). The inflammatory process, evoked as a result of injury to alveolar epithelium and/or the endothelium, is responsible for alveolar wall thickening that is the histologic marker of ILD. This article extrapolates some of the known pathogenic mechanisms of ILD from adult and animal models and applies this information for a better understanding of the pathogenesis of ILD in children. The clinical manifestations vary and are often subtle and nonspecific. There is no consensus on specific criteria for the clinical diagnosis of ILD in children. There are no pathognomonic laboratory criteria for the diagnosis of ILD in children other than the characteristic findings on histologic examination of the lung. It is important to make the diagnosis early to minimize lung damage. Therapy is directed toward the reduction of the inflammatory response to minimize or prevent the progression to fibrosis. ILD suffers from lack of uniform guidelines for diagnostic evaluation, therapy, and prognostic indicators essential for critical monitoring of disease activity. No one medical center has enough cases of ILD in children to allow objective evaluation of a significant number of cases with adequate longitudinal follow-up to determine guidelines for optimal management and to identify accurate prognostic indicators. The organization of a multicenter approach will guide us towards a better understanding of ILD in children.