Accurately classifying inflammatory bowel disease (IBD) type in pediatric patients may impact medical decision-making, direct therapy, and improve outcomes. This was a prospective cohort study evaluating classification of IBD and patient management with use of capsule endoscopy in pediatric patients with suspected or known IBD. Treating physicians completed a questionnaire before and after capsule endoscopy (CE) assessing clinical suspicion of Crohn's disease (CD) diagnosis, patient management decisions, and perceived impact of CE findings. Eighteen subjects [11F/7M, mean age 13.8 (± 2.5) years], 4 previously diagnosed with CD, 4 with ulcerative or indeterminate colitis (UC/IC), and 10 "suspected" to have IBD were included. Following CE, 2 of 4 (50%) UC/IC patients were reclassified as having small bowel CD. In the 4 subjects with known CD, 2 (50%) had CE evidence of more proximal small bowel mucosal disease than previously recognized. In the 10 subjects with "suspected" IBD, 8 (80%) had SB ulcerations leading to a definitive diagnosis of CD. Treating physicians reported CE helped diagnosing CD in 15 of 18 (83.3%) subjects and impacted medical decision-making in 13 of 18 (72.2%), leading to a change in medical management in 14 of 18 (77.8%). In "suspected" pediatric IBD, CE often leads to a definitive diagnosis of CD. CE can lead to reclassification of IBD from UC/IC to CD and previously diagnosed CD patients may have a more significant burden of small bowel disease. These data may help integrate CE in evaluating IBD patients, lead to more targeted medical management changes and improve outcomes.