Background. Oral oseltamivir administration is effective treatment for influenza in adults. This study was conducted to determine the efficacy, safety and tolerability of oseltamivir in children with influenza. Methods. In this randomized, double blind, placebo-controlled study, children 1 through 12 years with fever [≥100°F (≥38°C)] and a history of cough or coryza <48 h duration received oseltamivir 2 mg/kg/dose or placebo twice daily for 5 days. The primary efficacy endpoint was the time to resolution of illness including mild/absent cough and coryza mild/absent, return to normal activity and euthermia. Results. Of 695 enrolled children 452 (65%) had influenza (placebo, n = 235; oseltamivir, n = 217). Among infected children the median duration of illness was reduced by 36 h (26%) in oseltamivir compared with placebo recipients (101 h; 95% confidence interval, 89 to 118 vs. 137 h; 95% confidence interval, 125 to 150; P < 0.0001). Oseltamivir treatment also reduced cough, coryza and duration of fever. New diagnoses of otitis media were reduced by 44% (12% vs. 21%). The incidence of physician-prescribed antibiotics was significantly lower in influenza-infected oseltamivir (68 of 217, 31%) than placebo (97 of 235, 41%; P = 0.03) recipients. Oseltamivir therapy was generally well-tolerated, although associated with an excess frequency of emesis (5.8%). Discontinuation because of adverse events was low in both groups (1.8% with oseltamivir vs. 1.1% with placebo). Oseltamivir treatment did not affect the influenza-specific antibody response. Conclusions. Oral oseltamivir administration is an efficacious and well-tolerated therapy for influenza in children when given within 48 h of onset of illness.