Television and the internet face the threat of restrictions as the Government moves to protect youngsters from the "commercialisation" and sexualisation of childhood.
The Government's strategy for improving the lives of the UK's young people, to be published this week, will include plans for an investigation of the enormous number of outside influences that can affect children's buying habits, behaviour and self-image.
The Secretary of State for Children, Ed Balls, said the Government had attempted to cut the amount of top-brand advertising targeted at children. But recent research has revealed that they still face a blizzard of commercial messages from a variety of sources, including targeted "pop-up" adverts on their favourite websites. A National Consumer Council (NCC) report last week found that children are exposed to hundreds of ads on their favourite sites.
The American Psychological Association claimed merchandising and advertising images could lead to eating disorders, low self-esteem and depression.
Mr Balls said: "Children are more likely to make product purchases and define themselves in terms of specific brands at a young age. Academics are concerned at the link between commercial advertising and child well-being, self-esteem and anxieties."
He will confirm this week that a panel of experts will investigate the potential damage caused by the impact of commercialisation at a younger age, before ministers rule on any further action against advertisers.