This study aims to provide an overview of mental health problems of children and adolescents in Malaysia in general and the state of Terengganu in particular. It also highlights the challenges and the opportunities in the establishment of child and adolescent mental health services (CAMHS). CAMHS in Malaysia are developing slowly but have not reached the standards found in developed countries. Significant improvements are needed to ensure that the service can provide optimal help to children and adolescent as well as their families. Constraining factors such as a lack of trained workers, limited financial resources for training and inadequate facilities are among the challenges. Despite all these challenges, specific strategies are required to optimally utilise the potential existing resources. The Ministry of Health initiatives in creating and implementing the national mental health policy and increasing mental health awareness campaigns for children and adolescents are of paramount importance. To overcome the lack of resources in the implementation of CAMH services, in-service education and training, integration of mental health services with the existing primary health care facilities and cultivation of cooperative and communicative networks between primary care professionals, mental health workers and other relevant agencies are crucial steps.