Exhaled nitric oxide levels are elevated in asthmatic children and decrease after inhaled steroid treatment. We evaluated the time-dependent changes in fractional exhaled nitric oxide concentration (FENO) and pulmonary function parameters following inhaled steroid therapy. Thirty-nine steroid-naive atopic patients (age 11.92 ± 0.48 years) with mild intermittent asthma and 22 age-matched healthy controls were enrolled in the study; pulmonary functions and FENO levels were measured. Low doses of inhaled steroids were prescribed to all asthmatic patients who were reevaluated in a second visit (between 10 and 40 days after the beginning of the treatment). At the enrolment, asthmatic patients had similar forced expiratory volume in 1 sec (FEV1) and forced vital capacity (FVC) values (p > 0.05) but reduced forced expiratory flows at 25–75% of the vital capacity (FEF25–75%) values, as compared to controls (p < 0.05). In addition, FENO levels were significantly higher in asthmatics with respect to control subjects (30.8 ± 3.0 and 4.0 ± 0.5 ppb, respectively; p < 0.01). All asthmatics had FENO levels higher than 8.8 ppb (i.e., >2 standard deviations of the mean in controls). After steroid treatment, patients showed significant improvement of FEV1, FVC, and FEF25–75% (p = 0.0001; each comparison) and a reduction of FENO levels (p = 0.0001). A weak significant correlation was found between percent decrease in FENO levels and percent increase in FEV1 (r = 0.33, p = 0.04) or in FEF25–75% (r = 0.4, p = 0.01) after treatment. When changes in FENO levels and in pulmonary function parameters were corrected for days of treatment, significant correlations were still present between percent decrease in FENO levels and percent increase in FEV1 (r = 0.57, p = 0.0004) or percent increase in FEF25–75% (r = 0.45, p = 0.006). Sixteen of the 39 asthmatic patients were evaluated on two occasions after the beginning of treatment, at days 10 and 40. The significant reduction in FENO levels (p < 0.01) and the significant increase in FEV1 and FEF25–75% values observed (p < 0.05) after 10 days did not further improve at day 40. These data show that it is possible to demonstrate early effects of low-dose inhaled steroids in asthmatic children using objective measurements of airway caliber and inflammation.