Abstract Background Medicines designed for adults may be inappropriate for use in children in terms of strength, dosage form and/or excipient content. There is currently no standardised method of assessing the age-appropriateness of a medicine for paediatric use. Aim To develop and test a tool to assess whether a dosage form (formulation) is appropriate for children and estimate the proportion of formulations considered ‘inappropriate’ in a cohort of hospitalised paediatric patients with a chronic illness. Method A multi-phase study: patient data collection, tool development, case assessments and tool validation. Inpatients aged 0–17 years at two UK paediatric/neonatal hospitals during data collection periods between January 2015 and March 2016. Written informed consent/assent was obtained. Medicines assessed were new or regularly prescribed to inpatients as part of their routine clinical care. All medicine administration episodes recorded were assessed using the Age-appropriate Formulation tool. The tool was developed by a consensus approach, as a one-page flowchart. Independent case assessments were evaluated in 2019. Results In 427 eligible children; 2,199 medicine administration episodes were recorded. Two assessors reviewed 220 episodes in parallel: percentage exact agreement was found to be 91.7% (99/108) and 93.1% (95/102). In total, 259/2,199 (11.8%) medicine administration episodes involved a dosage form categorised as ‘age-inappropriate’. Conclusion A novel tool has been developed and internally validated. The tool can identify which medicines would benefit from development of an improved paediatric formulation. It has shown high inter-rater reliability between users. External validation is needed to further assess the tool’s utility in different settings.