In many instances, adults serve as gatekeepers for what books children are permitted to explore. Unfortunately, this means that most children have limited access to picture books with lesbian, gay, bisexual, transgender, and queer (LGBTQ) characters. In this article, we use queer pedagogy and observations about neoliberalism to provide a qualitative analysis of LGBTQ characters in picture books which were finalists for a Lambda Literary Award during 2000-2005. We examined the ways in which LGBTQ identities and relationships are negotiated and how sexual prejudice is treated. While it is improbable that the books we analyze would be embraced by proponents of neoliberalism, we also briefly consider some ways in which they may be inadvertently consistent with that perspective. The article closes with recommendations regarding discussion questions, additional readings, and educational activities aimed at guiding children, and adults, to appreciate a diversity of multidimensional identities and family structures, to develop strategies to respond constructively to emotional and physical violence, and to promote the public wellbeing. We hope that this analysis will lead to more frequent, productive, and expansive discussions of this literature among adults and children.