There is limited evidence regarding the association between consumption of highly processed foods (HPFs) and overall diet quality in children and adolescents from Asian countries. This study aimed to examine the association between HPF consumption and overall diet quality in Japanese children and adolescents. A cross-sectional analysis was conducted based on 8-day dietary record data collected from volunteers in 32 of 47 prefectures throughout Japan in 2016 to 2020. Foods were categorized into 1 of 4 processing levels using the framework developed by the University of North Carolina at Chapel Hill. Food classification was performed under a low-estimate scenario (classifying mixed dishes consumed outside the home after disaggregation into ingredients) and high-estimate scenario (classifying them into HPFs without food disaggregation). A total of 1318 Japanese children and adolescents aged 3 to 17 years participated in the study. Diet quality was assessed using the Healthy Eating Index-2020 and Nutrient-Rich Food Index 9.3. Multiple regression models adjusted for sociodemographic and anthropometric characteristics and the survey cycle were used to examine the association between tertiles of the energy contribution of HPFs and diet quality. The mean energy contribution of HPFs was 27.3% and 44.3% in the low- and high-estimate scenarios, respectively. The top contributors to total energy intake from HPFs were confectioneries in the low-estimate scenario and cereals and starchy foods in the high-estimate scenario. Irrespective of the scenarios, participants in higher tertiles of energy contribution of HPFs had lower total scores for Healthy Eating Index-2020 and Nutrient-Rich Food Index 9.3 (P for trend < .0001). HPFs accounted for more than one-quarter of the energy intake of Japanese children and adolescents surveyed, and higher consumption of HPFs was associated with lower diet quality. Therefore, reducing HPF consumption may increase overall diet quality among Japanese children and adolescents. Further research is needed to explore the causal nature of this association.