The mother, referred to only as Mrs Z to protect the boy's identity, said she was in a store with her three-year-old daughter and her son when she realised he was not with her at the till.
She went to the store entrance in the Strand precinct, Bootle, Merseyside, and saw his head going behind benches outside.
Mrs Z told the jury: 'I went outside and saw him running behind the benches, so I went round the back . . . as I was running I looked over the benches and saw the taller lad running and stopping, and Z was following him. Then he dived behind a post.'
She said her son was giggling and laughing - 'It was fun, someone was playing with him, he was happy and was just following them.'
She saw another boy, who she referred to as 'the chubby one' walking near by. When she caught up with her son, one of the boys - the taller one - 'was clutching the post and was looking at Z and was beckoning him to come on'.
Richard Henriques, for the prosecution, asked her: 'Did you hear the boy beckoning say anything?'
Mrs Z said: 'He looked up and he just looked surprised to see me and he said 'go back to your mum'.
'That threw me, I didn't know what to do. I was surprised.'
Asked why she was surprised, Mrs Z said: 'It was obvious what . . .', but then she paused and added: 'I don't know.'
Mr Henriques: 'What had been happening just before.'
Mrs Z: 'Well it looked like he was enticing my son to follow him, but at the same time I wasn't sure what he was doing.'
She said that earlier in the store, which she had gone to after arriving at about midday, her son and her daughter had gone towards the purse stand. 'The chubby lad came towards the children,' she said. 'He was kneeling down and he was playing with some purses.
'At first he was on his own and then he shouted to someone and they came as I was trying to get my kids away.
'The chubby lad had hold of one of the purses and was opening and closing it and keeping his eyes on the purse and looking - and out of the corner of his eye went to look at Z and he realised I was there.
'He just froze as the other lad was coming towards him. They didn't speak, they just froze.'
She said she had identified the two boys she saw in a video shown to her as the two boys she had seen in the precinct.
As Mrs Z told the court how child B had enticed her son away, the boy, listening from the dock, began to cry. He dabbed his eyes with a handkerchief as the social worker alongside comforted him. child A, now in shirtsleeves in the warm courtroom, began sucking his thumb.
Moments from the end of her cross-examination, Mrs Z also broke down and wept in the witness box. She was handed a tissue and was allowed to compose herself before completing her evidence.
Mr Justice Morland allowed her to sit for the last few minutes of her evidence, during which she said she thought her son was playing 'tick' with the two boys.
Mrs Z contacted the police on the Tuesday following the abduction and murder.
Brian Walsh QC, representing B, asked her: 'You made no effort to get in touch with the police until you had become aware of the awful news about James Bulger?'
Mrs Z: 'I didn't think that anyone of that age could kill anyone.'
Mr Walsh: 'Please answer the question. It was Tuesday, after everyone had heard the news about James Bulger?' Mrs Z: 'Yes.'
'Would this be a fair view - if you had not heard the news about James Bulger and had it never happened, it is highly unlikely you would have contacted the police. Would you agree?' - 'Yes,' Mrs Z said.
The two 11-year-olds both plead not guilty to abducting James, two, from Kirby, Merseyside, on 12 February this year. They also deny attempting to abduct a second two-old boy on the same day.
The trial continues today.