The clothes will be designed, made and distributed by Chinese firm Shanghai Longhurst. According to Jackie Woodward, vice-president for McDonald's global brand business, the fast food giant will begin selling children's clothing and footwear in Shanghai later this month and in early 2005 will branch out to the US, Canada, Japan, Mexico, Australia, Korea, Taiwan and Western Europe.
With the launch into Europe, Japan and North America in 2005 the range will also be extended to include toys, videos, DVDs and books.
McDonald's has already trialled McKids clothing at a small number of stores products in stores in Shanghai and Indonesia.
McDonald's said the clothing was intended to offer "quality fabrics in styles that will endure season after season".
Larry Light, McDonald's global chief marketing officer, said the move exemplified "a new thinking".
The multi-retail licensing programme will also include toys, videos, books and other lifestyle products.
McDonald's has described the move as "one more strategic element in the company's ongoing revitalisation plan" that "exemplifies the kind of new thinking, focus and bold action that is redefining McDonald's".
Critics of McDonald's have long complained that children are the target of its fast food advertising and that the brand is currently the centre of an obesity epidemic.
In 1997, the High Court judge in the "McLibel" trial ruled that the company's ads exploited children by using them as more susceptible subjects of advertising to pressure their parents into going to McDonald's.
McDonald's created McKids clothing in 1987 and 10 years later Wal-Mart became its franchise store.
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