Anxious children interpret ambiguous situations in a more threatening way and choose more avoidant solutions compared with non-anxious children. This study sought to (1) compare the interpretations of clinically anxious (N = 25) and nonanxious children (N = 33) on two different interpretation tasks used previously and to (2) examine whether threat-based interpretations in anxious children (N = 19) are modified following cognitive behavioural treatment (CBT). Children (1) heard stories in which ambiguous situations were described, and their perceived ability to influence situations was rated and (2) read words that had both threat and neutral meanings, and were asked to use the word in a sentence. Results showed that in comparison to nonanxious children, anxious children reported being significantly less able to influence situations and gave more threat-based interpretations of words. Following treatment, anxious children's ability to influence the situation was significantly improved and they tended to make fewer threat-based interpretations of words. Moreover, at post-treatment, anxious children's perceived ability to influence situations and the number of threat-interpretations given was comparable to a matched non-anxious group. These results indicate that anxious children's ability to exert control and cope with ambiguous situations can be improved through CBT.