Interstitial lung diseases (ILD) are disorders of the lower respiratory tract, characterized by chronic inflammation of the lung parenchyma, varying degree of fibrosis, derangement of the alveolar walls and loss of the functional alveolar capillary units. ILD are relatively uncommon in children. Most of the interstitial lung diseases have no known etiology. In children, common diseases associated with ILD include viral respiratory tract infections (RSV, parainfluenza, etc.), gastroesophageal reflux, idiopathic pulmonary fibrosis, pulmonary hemosiderosis, eosinophilic pneumonia, pneumonitis associated with AIDS, etc. Chronic inflammation of the alveoli (alveolitis), the initial injury in ILD, and several mediators released from inflammatory cells (eosinophils, neutrophils and macrophages) can cause fibrosis and derangement of alveolar walls. Dyspnea and a non-productive cough are the cardinal symptoms of ILD. Other findings include chest pain, hemoptysis and weight loss. Clubbing of fingers occur in approximately 50 per cent of cases. Diagnosis is based on a combination of history, clinical findings, radiographic findings, pulmonary function tests and histologic findings. Open lung biopsy has been very helpful in providing information regarding the extent and nature of the damage, prognosis and response to therapy. There are 3 main aspects in the treatment of ILD. The most important step is to identify and eliminate the cause. The second is suppression of the inflammation. The third is supportive and symptomatic treatment. Corticosteroids are the drugs commonly used for suppression of inflammation. Immunosuppressive drugs (azathioprine, cyclophosphamide) have also been tried. Lung transplantation and heart transplantation have been successfully achieved in selected patients. The results of therapy should be regularly monitored by clinical symptoms, chest radiographs and serial pulmonary function studies.