Background: In April 2017, the Australian Government announced the full subsidy of continuous glucose monitors (CGM) to children and young people <21 years with type 1 diabetes (T1D). This study aimed to evaluate the effect of CGM on psychosocial outcomes in a T1D pediatric population-based sample. Methods: Children with T1D, commencing CGM between June 2017 and January 2018, and their parents were recruited in a prospective cohort study in a tertiary pediatric hospital in Western Australia. Parents and children older than 12 years self-completed questionnaires at onset of CGM and 2 months later, on fear of hypoglycemia (FOH) and diabetes treatment satisfaction (DTS). Parents provided measures of sleep quality. Children completed the Gold hypoglycemia awareness score. Hemoglobin A1c (HbA1c) values were compared at baseline (BL) and follow-up (FU). Results: Sixty parents and 38 children provided measures at BL and FU. Parental total FOH decreased (mean score BL vs. FU; 50.0 vs. 44.3, P = 0.004) with reduction in the Worry subscore (28.2 vs. 24.2, P = 0.004). Furthermore, parental and child DTS increased. Parental sleep quality improved (P < 0.001) and overnight finger prick testing decreased (P < 0.001). Impaired hypoglycemic awareness decreased in children (26.3% vs. 10.5%, P = 0.031). HbA1c reduced from 8.4% (68 mmol/mol) to 8.1% (65 mmol/mol) (P = 0.036). Conclusions: Introduction of subsidized CGM showed early improvement in psychosocial and glycemic outcomes in patients and their families in Western Australia. Ongoing evaluation is essential to assess whether equitable access to CGM will translate to sustained benefits for Australian T1D pediatric patients.