For many years mental health services for children have been developed incrementally with little attention to the needs of the local population. However, over the past decade there have been attempts to develop more rational ways of planning child mental health services. This paper describes the information required to develop a needs-led child mental health service and, within that context, discusses how priorities should be set. It will be suggested that although the assessment of needs for child and adolescent mental health services is still very haphazard, there is now a clear trend for the evaluation of clinical practice to become more systematic. At an individual level we know quite a lot about the efficacy of treatment and the measurement of outcomes. At the service level, several models of good practice are being specified and evaluated.