ABSTRACT. Parents, consumer organizations, and policy makers are generally con- cerned about effects of TV advertising directed towards children. These effects might be mediated by children’s understanding of TV advertising, that is their ability to distinguish between TV programmes and commercials and their comprehension of advertising intent. In this paper, we investigate children’s understanding of TV adver- tising, using verbal and non-verbal measurements. The sample consists of 153 Dutch children, ranging from 5 to 8 years old, and their parents. The results based on non-verbal measures suggest that most children are able to distinguish commercials from programmes and that they have some insight into adver- tising intent. The results based on verbal measures are not as conclusive; the percentage of children who show understanding of TV advertising is then substantially lower. Effects of age, gender, and parental influence are assessed using MURALS, a regres- sion analysis technique for categorical and continuous variables, and CHAID, a technique for identifying homogeneous segments on the basis of the relationship between categorical dependent and explanatory variables. The age of a child turns out to have a positive effect. The effects of gender and parent-child interaction are rather small, both for verbal and for non-verbal measures of understanding of TV adver- tising. A high level of parental control of TV viewing may result in lower understanding of TV advertising. Implications for consumer policy and directions for future research are discussed. From a child’s point of view, what is the purpose of TV advertising? Is there advertising on TV in order to give actors the opportunity to take a rest or practise their lines? Or is the aim of TV advertising to encourage people to buy things? Furthermore, is the main difference between programmes and commercials that commercials are for real, whereas programmes are not, or that programmes are for kids and commercials for adults? As has been shown several times in the lit- erature (e.g., Butter, Popovich, Stackhouse, & Garner, 1981; Donohue, Henke, & Donohue, 1980; Macklin, 1983, 1987; Robertson & Rossiter, 1974; Stephens & Stutts, 1982), some children are able to distin- guish between programmes and commercials and are aware of the intent of TV advertising, whereas others are not. In general, however, Journal of Consumer Policy 21: 171–194, 1998.  1998 Kluwer Academic Publishers. Printed in the Netherlands. Tammo H. A. Bijmolt, Wilma Claassen and Britta Brus Children’s Understanding of TV Advertising: Effects of Age, Gender, and Parental Influence