The dermoscope allows physicians to examine the macroscopic and microscopic primary morphology of skin lesions, identify subtle clinical clues, confirm naked-eye clinical diagnoses, and monitor treatment progress while posing little threat to the young patient. This review summarizes important dermoscopic structures seen in infectious and inflammatory skin conditions and hair disorders in children. Scabies, pediculosis, phthiriasis, molluscum contagiosum, tinea nigra, and verrucae are well characterized dermoscopically by delta-shaped structures, ovoid-shaped nits, the crab louse, red corona, brown strands or spicules, and multiple densely packed papilla with a central black dot surrounded by a whitish halo, respectively. These dermoscopic structures will be discussed, focusing on the dermoscopic morphologies and dermoscopic sensitivity for diagnosis and its utility in monitoring treatment progress. Dermoscopy has also been shown to significantly improve the clinician's diagnostic and monitoring accuracy of inflammatory skin lesions such as psoriasis, which is characterized dermoscopically by uniformly distributed dotted blood vessels, and lichen planus, which is characterized by whitish lines on a purple to reddish background. Dermoscopy of the hair and scalp (trichoscopy) facilitates the differential diagnosis of hair diseases in children, including alopecia areata, trichotillomania, and tinea capitis. It can also assist in the diagnosis of multiple genetic hair shaft disorders, such as monilethrix, trichorrhexis invaginata, trichorrhexis nodosa, pili torti, and pili annulati.