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Some 290,000 children under the age of 15 died of AIDS last year and 12.1 million children in sub-Saharan Africa lost one or both parents to the disease, according to the "Children and AIDS" report by the World Health Organisation, UNICEF and UNAIDS.
"Today's children and young people have never known a world free of AIDS," UNICEF executive director Ann Veneman said on Thursday.
"Children must be at the heart of the global AIDS agenda," she urged.
The report highlighted four areas crucial to tackling the epidemic: preventing HIV transmission from mothers to children; providing paediatric treatment; preventing infection among adolescents and young people; and protecting and supporting children affected by AIDS.
While some progress has been made in all these areas, the report found that significant challenges remain.
For example, 21 countries including Botswana, Brazil, Rwanda, South Africa and Thailand are now on track to reach 80 per cent coverage to prevent mother-to-child HIV transmission by 2010, up from only 11 countries in 2005.
The proportion of HIV-positive pregnant women receiving retroviral drugs to reduce the risk of transmitting the virus to their children rose by 60 per cent from 2005 to 2006 - although this still means that less than a quarter (23 per cent) of all such women get retrovirals.
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