Various official reports have established that child activity options have a link to household poverty. Specifically, research acknowledges a two-way link between child labour and household poverty. Some researchers argue that the increasing participation of children in economic activities is a result of illiteracy and poverty, among other social and economic problems. Others view such participation as an important strategy by poor households to rise above the poverty line. In Nigeria, reports have identified an increasing incidence of the child welfare variables – schooling and work – have not been possible until now. This study is therefore expected to fill this gap in knowledge using data from the Nigeria Child Labour Survey, 2001. Among the major conclusions emerging from the study is that there are structural differences in the choice of child activity options across gender, age, sector and zones in Nigeria. Although the evidence of a sector gap exists, the participation of children in economic activity particularly increases in rural areas. In all the measures of poverty used, there are also differences in child activity options across poverty status, which points to poverty as an important variable of child welfare. Finally, there were percentage differences in income contribution across age groups, gender and zones in Nigeria. The econometric estimation noted that some child, parent, household and community variables significantly affect the child activity options. Specifically the age of the child, household composition, education of father, sector, zone and adult income determine child activity options. Most of these contradict or support many of the findings of child labour studies in other developing countries. Based on this it is recommended that for formulating effective policy to reduce child labour in Nigeria, the age of the child, income status of the household, education of the parents, and sector and zone must constitute important variables. Also, awareness campaigns on the cost of child participation in economic activities should be given priority. More importantly, if overall economic conditions are not improved to lift families out of poverty, children will continue to get involved in economic activities to enhance family income, irrespective of any regulatory or legislative prohibitions.