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Aims: To assess the extent of off‐label drug use and the occurrence of suspected adverse drug reactions (ADRs) among paediatric patients in Italian hospitals. Methods: We conducted a 2‐year prospective cohort study across 22 Italian hospital wards from September 2020 to September 2022. As part of the surveillance project, we performed a 6‐month retrieval of all reported ADRs and evaluated all drug prescriptions for their possible off‐label use. Following an educational project on pharmacovigilance addressed to healthcare professionals in participating wards, the same data collection was performed. Results: Among the 892 patients included in the study, 64% were admitted to paediatric wards and 36% to neonatal wards. Fifty per cent of all drugs prescribed were used off‐label and mainly concerned the administration of a different dose from the one authorized. In neonatal wards, off‐label prescriptions occurred slightly more often, with antibacterials being the most frequently used off‐label drugs. A total of 35 reports of suspected ADRs were collected, five before the educational project and 30 afterwards. Based on product licence, 10 of the total 35 reports concerned at least one off‐label drug use. Conclusions: The off‐label use of drugs in treating paediatric patients was extensive in Italian hospitals. Regulatory interventions are needed to promote the use of drugs based on the latest available literature and improve ADR reporting on children. Paediatric indications and dosages of the drugs most commonly used in children should be supported by appropriate ad hoc studies. [ABSTRACT FROM AUTHOR]