Obstructive sleep apnea (OSA) in children is a highly prevalent disorder caused by a conglomeration of complex pathophysiological processes, leading to recurrent upper airway dysfunction during sleep. The clinical relevance of OSA resides in its association with significant morbidities that affect the cardiovascular, neurocognitive, and metabolic systems. The American Academy of Pediatrics recently reiterated its recommendations that children with symptoms and signs suggestive of OSA should be investigated with polysomnography (PSG), and treated accordingly. However, treatment decisions should not only be guided by PSG results, but should also integrate the magnitude of symptoms and the presence or absence of risk factors and signs of OSA morbidity. The first-line therapy in children with adenotonsillar hypertrophy is adenotonsillectomy, although there is increasing evidence that medical therapy, in the form of intranasal steroids or montelukast, may be considered in mild OSA. In this review, we delineate the major concepts regarding the pathophysiology of OSA, its morbidity, diagnosis, and treatment.