Two behavioural strategies for reducing learned fear are extinction and counter-conditioning, and in this study we compared the relative effectiveness of the two procedures at diminishing fear in children. Seventy-three children aged 7–12 years old (M = 9.30, SD = 1.62) were exposed to pictures of two novel animals on a computer screen during the fear acquisition phase. One of these animals was paired with a picture of a scared human face (CS+) while the other was not (CS-). The children were then randomly assigned to one of three conditions: counter-conditioning (animal paired with a happy face), extinction (animal without scared face), or control (no fear reduction procedure). Changes in fear beliefs and behavioural avoidance of the animal were measured. Counter-conditioning was more effective at reducing fear to the CS + than extinction. The findings are discussed in terms of implications for behavioural treatments of childhood anxiety disorders.