Objective: There has been a rapid increase in the use of atypical antipsychotics in pediatric populations over the past few years. Most of these drugs are unapproved in pediatric populations. Study objectives were: 1) To identify the trend of new users of atypical antipsychotics in the Arkansas Medicaid population under the age of 18 for years 2001 through 2005; 2) to classify the use of each atypical antipsychotic as evidence-based or not depending on the diagnoses for which it was prescribed; and 3) to determine which pediatric patients are more likely to receive an evidence-based atypical antipsychotic prescription. Methods: Study was a retrospective database analysis of Arkansas Medicaid for the period from January 2000 to December 2006. Participants were the subjects under 18 years of age, with their first atypical antipsychotic prescription claim between 2001 and 2005, with no prior antipsychotic use and having a continuous two-year Medicaid enrollment. Main outcome measure was the proportion of study cohort with at least one evidence-based atypical antipsychotic prescription claim, which was defined as any use of atypical antipsychotic supported by a clinical study in the literature. Results: The final study cohort was 11,700. The trend of new pediatric users of atypical antipsychotic therapy increased from 1482 to 3110 new atypical users from 2001 to 2005. After identifying 86 clinical studies from the literature and defining the evidence-based use for each atypical antipsychotic, it was found that 41.32% of the new pediatric users did not have any evidence-based conditions. Risperidone had the lowest levels of non-evidence base use of (30.59%) and aripiprazole had the highest (77.13%). Conclusion: The rate of atypical antipsychotic use in pediatrics has doubled between 2001 and 2005 and a large proportion of the usage in the Arkansas Medicaid pediatric population is not based on strong clinical evidence.