Traditional pediatric anesthetic dosing using pharmacokinetic estimates based on age and weight is often imprecise, frequently leading to oversedation. Intraoperative electroencephalography (EEG) allows visualization of the brain’s response to anesthetic agents in real time, facilitating precise titration of anesthetic drug doses optimized for the individual child. The goal of EEG-guided anesthesia management is to maintain an optimal state of hypnosis during various stages of the procedure while minimizing hemodynamic instability and other adverse effects of anesthesia. This is especially important in children with less predictable anesthetic requirements, such as children with atypical neurodevelopment, altered levels of consciousness before anesthesia, or those receiving total intravenous anesthesia, neuromuscular blockers, or a combination of anesthetic agents with different mechanisms of actions. Children with limited cardiorespiratory reserves and those undergoing high-risk procedures such as cardiopulmonary bypass also benefit from EEG guidance as they have a narrower therapeutic window for optimal anesthetic dosing. Various processed EEG (pEEG) monitors are available for intraoperative monitoring in children. These monitors display a pEEG index based on the manufacturer’s algorithm, purportedly indicating the patient’s hypnotic state. Due to differences in developmental neurophysiology and EEG dynamics in children, pEEG indices may not always reliably indicate the hypnotic state, especially in neonates and infants. Learning to interpret nonproprietary EEG parameters including the raw EEG, spectral-edge frequency 95% (SEF95), and density spectral array can prevent overreliance on pEEG indices. This review provides an overview of the advantages of EEG guidance during clinical anesthesia, including potential reduction in anesthetic dosage, prevention of EEG suppression, and reduction in peri-operative adverse events. We describe the use of nonproprietary EEG parameters in guiding anesthesia in children for various clinical end points including laryngoscopy, surgical incision, and maintenance of anesthesia, as well as sedation. We illustrate these principles with various case examples commonly encountered during pediatric anesthesia. Lastly, we discuss strategies to expand intraoperative EEG monitoring in children through education and training programs, as well as advocate for further research to assess clinical outcomes associated with EEG guidance to support its routine use in clinical care.