Background It is standard practice for laboratories to assess the cellular quality of expectorated sputum specimens to check that they originated from the lower respiratory tract. The presence of low numbers of squamous epithelial cells (SECs) and high numbers of polymorphonuclear (PMN) cells are regarded as indicative of a lower respiratory tract specimen. However, these quality ratings have never been evaluated for induced sputum specimens from children with suspected pneumonia. Methods We evaluated induced sputum Gram stain smears and cultures from hospitalized children aged 1–59 months enrolled in a large study of community-acquired pneumonia. We hypothesized that a specimen representative of the lower respiratory tract will contain smaller quantities of oropharyngeal flora and be more likely to have a predominance of potential pathogens compared to a specimen containing mainly saliva. The prevalence of potential pathogens cultured from induced sputum specimens and quantity of oropharyngeal flora were compared for different quantities of SECs and PMNs. Results Of 3772 induced sputum specimens, 2608 (69%) had <10 SECs per low-power field (LPF) and 2350 (62%) had >25 PMNs per LPF, measures traditionally associated with specimens from the lower respiratory tract in adults. Using isolation of low quantities of oropharyngeal flora and higher prevalence of potential pathogens as markers of higher quality, <10 SECs per LPF (but not >25 PMNs per LPF) was the microscopic variable most associated with high quality of induced sputum. Conclusions Quantity of SECs may be a useful quality measure of induced sputum from young children with pneumonia.</p