The measurement of circulating tumor DNA (ctDNA) has gained increasing prominence as a minimally invasive tool for the detection of cancer-specific markers in plasma. In adult cancers, ctDNA detection has shown value for disease-monitoring applications including tumor mutation profiling, risk stratification, relapse prediction, and treatment response evaluation. To date, there are ctDNA tests used as companion diagnostics for adult cancers and it is not understood why the same cannot be said about childhood cancer, despite the marked differences between adult and pediatric oncology. In this review, we discuss the current understanding of ctDNA as a disease monitoring biomarker in the context of pediatric malignancies, including the challenges associated with ctDNA detection in liquid biopsies. The data and conclusions from pediatric cancer studies of ctDNA are summarized, highlighting treatment response, disease monitoring and the detection of subclonal disease as applications of ctDNA. While the data from retrospective studies highlight the potential of ctDNA, large clinical trials are required for ctDNA analysis for routine clinical use in pediatric cancers. We outline the requirements for the standardization of ctDNA detection in pediatric cancers, including sample handling and reproducibility of results. With better understanding of the advantages and limitations of ctDNA and improved detection methods, ctDNA analysis may become the standard of care for patient monitoring in childhood cancers.