Background: Children are particularly vulnerable to the psychological effects of the COVID-19 pandemic. The disruption in daily life has impacted children significantly. Moreover, the increased worrying associated with the probability of getting infected or becoming seriously unwell due to infection can potentially precipitate anxiety disorders among children. Objective: This study aimed to determine rates of elevated anxiety symptoms in children with COVID-19 infection. It also explored whether there were any differences in terms of age, gender, and residency status. Method: A cross-sectional, questionnaire-based study with 88 participants (children aged 7-13 years, 54.5% males, 45.5% females) from two institutional quarantine centers. The Spence Children’s Anxiety Scale and its validated Arabic version (self-reported questionnaires) were used to measure anxiety symptoms. Results: 36.3% children reported elevated anxiety symptoms. A lower rate of 32.8% was reported in younger children (7-11 years) compared to 45.8% in older children (12 and 13 years). 70.4% and 57.9% children reported physical injury fears and separation anxiety respectively. A higher prevalence of overall anxiety was reported in children from expatriate families (40.6%) compared to native children (25%). The difference in the mean scores between the expatriate and native group of children was found statistically significant for obsessive-compulsive symptoms. Conclusions: The prevalence of elevated anxiety symptoms among children in quarantine with COVID-19 infection can be much higher than that reported in the general population. Older children can have elevated anxiety symptoms more commonly than their younger counterparts can. Expatriate children are likely to be more vulnerable to the psychological impact of the pandemic compared to children from local families. Our results suggest the crucial need of focusing on the psychological impact of COVID-19 pandemic on children. The prioritization and effective management of the mental health needs of children should be a vital component of the overall, global response to the pandemic.