Background: Children's environmental health encompasses a wide range of factors that impact the well-being of children, including physical, chemical, biological, and social elements in their immediate environment. Safeguarding children from harmful substances is the crucial role of nursing students. Nursing students play a vital role as valuable resources for individuals, families, communities, and policymakers. This study aims to assess the knowledge and skills of nursing students concerning children's environmental health at academic institutions delivering nursing program in Nekemte town, Ethiopia. Methods: An institutional-based cross-sectional study design was carried out from August 1–30, 2023, among nursing students in Nekemte Town, and 634 study participants were selected through simple random sampling. Data was entered into Epinfo version 6.4 and exported to STATA version 14 for analysis, and multicollinearity was checked. Finally, from the bivariate analysis, variables of < 0.2 were included in the multivariate analysis; an adjusted odd ratio with a 95% CI was computed; and variables with a P-value <0.05 in the multivariable analysis were taken as significant associated factors. Results: The overall nursing students' level of knowledge about children's environmental health was insufficient (56%). More than one-third (34%) demonstrate their skill towards children's environmental health insufficiently, and one-fourth (25%) and 27% of the learners conduct their craft to prevent children from ecological hazards to a good and better level, respectively. While gender of the participant, age of the participant, year of the study, training history of the participants, and field of study of the students were significantly associated variables with their knowledge of children's environmental health. Conclusion: The study reveals that nursing students' knowledge of children's environmental health is limited, with factors such as gender, age, training history, and field of study significantly influencing their understanding. Therefore, female students should be considered for more tutorials to be effectively knowledgeable regarding children’s environmental health.