The mental health of young people is a growing public health concern. With socio-emotional difficulties in youth often resulting in psychiatric disorders later in life and most with mental health conditions rather stabilizing in time, it is essential to support healthy socio-emotional development. With a comprehensive definition of mental health, since emotion regulation (ER) plays a critical role in prevention, it becomes imperative to better understand how children effectively manage their emotions from an early age. Determining effective use of ER skills relies on adequate measurements. Typical methods of data collection in children present consistent shortcomings. This review addresses research findings considering the suitability of the late positive potential measured through electroencephalogram as a neural indicator of ER in children and youth. There is growing evidence, as reported in this review, that indicates that the late positive potential may be a reliable neural indicator of children’s cognitive reappraisal abilities more specifically. Results generally suggest that the late positive potential amplitudes are sensitive to directed reappraisal in children. However, given the scant research, questions remain regarding developmental trends, methodology, interindividual variability, reappraisal of various stimuli, and how the late positive potential may relate to more traditional measures of ER. Directions for future research are provided, which are expected to address unanswered research questions and fill literature gaps. Taken together, the findings reviewed indicate that the late positive potential is generally sensitive to directed cognitive reappraisal in children and that there is promise of establishing this neural marker as an indicator of ER.