To determine the incidence of adverse drug reactions (ADRs) to unlicensed and off-label drugs used in paediatric inpatients, we carried out prospective surveillance on five different paediatric wards in a regional children's hospital for 13 wk. Comparison of the use of each drug with its summary of product characteristics was made to determine whether the drug was used in an unlicensed or off-label manner. The presence of an ADR was determined using previously defined criteria. In total, 4455 courses of drugs were administered to 936 patients in 1046 admissions. In 507 (48%) of the 1046 admissions, patients received one or more unlicensed or off-label drugs. ADRs occurred in 116 (11%) of the 1046 patient admissions. ADRs were associated with 112 (3.9%) of the 2881 licensed drug prescriptions and 95 (6%) of the 1574 unlicensed or off-label drug prescriptions. Use of drugs in an off-label or unlicensed manner to treat children is widespread. ADRs are a significant problem following unlicensed or off-label drug prescriptions.