Inclusion criteria - Screening/Run-In Period

• age >= 2 years through age <=17 years of age
• IGA score of 2, 3, or 4 (mild, moderate, or severe AD) affecting >5% TBSA
• outpatients

Exclusion Criteria:Screening/Run-In period

• subjects who applied topical therapy (e.g. tar, topical corticosteroids) within 2 weeks prior to Screening
• subjects who received phototherapy (e.g. UVB, PUVA, Narrow Band) within 4 weeks of Screening
• subjects who received any systemic immunosuppressant
• subjects who received systemic steroids
• females who are pregnant or breast-feeding, or planning to become pregnant during the study
• subjects who are immunocompromised (e.g. lymphoma, AIDS, Wiskott-Aldrich syndrome) or have a history of malignancy (includes basal cell carcinoma, squamous cell carcinoma, melanoma)
• subjects with open skin infections (bacterial, viral or fungal) if at the application site.
• subjects will HSV (common cold sores) are allowed to participate in the study (if not at the application site).
• subjects who have head lice or scabies
• subjects who present with clinical conditions other than AD that may interfere with the evaluation (e.g., generalized erythroderma, acne, Netherton's Syndrome,psoriasis)
• subjects that require systemic therapy for the treatment of atopic dermatitis
• subjects with poor or no clinical response to tacrolimus ointment (Protopic®) or pimecrolimus cream 1%
• subjects who used any experimental or investigational drug or therapy within 6 weeks prior to Screening
• subjects who intend to use experimental or investigational drug therapy during the course of this study
• subjects with known hypersensitivity to pimecrolimus 1% or related drugs (see Investigator's Brochure)
• subjects who are non-compliant with general medical treatment, or are known to miss appointments, or don't intend to comply with the protocol for the duration of the study
• drug abuse, mental dysfunction, or other factors limiting the subject's ability to cooperate fully with study-related procedures
• subjects known to be unreliable or may be unable to complete the study
• any condition or prior/present treatment that would render the subject ineligible for the study

Inclusion criteria - Double-blind Maintenance treatment period

- Achieve complete remission of active disease (no signs or symptoms of AD) without incidence of "relapse" by the end of 6-week Run-In period (may be earlier); or who achieve "disease improvement" (decrease in IGA score by 1 full point confirmed by the investigator) without incidence of relapse at the end of the 6-week Run-In period

Exclusion criteria - Double-blind Maintenance treatment period

• subjects who experienced a "relapse" during the Run-In period
• subjects who applied topical corticosteroids or any alternative or additional therapy for the treatment of AD during the Run-In period
• subjects with active skin infections (bacterial, viral or fungal) except common cold sores (HSV) at the application site
• subjects who failed to record study medication use (and non use) and dosing regimen during the Run-In period
• subjects who failed to apply open label study drug twice daily until "disease remission" or end of the 6 week Run-In period
• subjects who failed to record concomitant medications during the Run-In period
• failure to return open-label study drug (used, partially used, and unused tubes) at the time double-blind study drug is dispensed. In order to avoid medication error, all open label study drug must be returned to the site before starting the Maintenance period