One factor that may be important in explaining rising childhood obesity is food prices. This report explores the effect of food prices on children’s Body Mass Index (BMI) using data from the Early Childhood Longitudinal Study, Kindergarten Class of 1998-99 (ECLS-K) and the Quarterly Food-at-Home Price Database. On average, higher prices for soda, 100 percent juices, starchy vegetables, and sweet snacks are associated with lower BMIs among children. In addition, lower prices for dark green vegetables and lowfat milk are associated with reduced BMI. The effect of subsidizing healthy food may be just as large as raising prices of less healthy foods.