This paper illustrates the intensified engagement that youth are having with digital technologies and introduces a framework for examining "digital fluency"--the competencies, new representational practises, design sensibilities, ownership, and strategic expertise that a learner gains or demonstrates by using digital tools to gather, design, evaluate, critique, synthesize, and develop digital media artefacts, communication messages, or other electronic expressions. A primary goal of this paper is to identify promising perspectives through which learning is conceptualized, and to share the methodological challenges in investigating digital fluency in both individual and collaborative learning activities that take place in complex naturalistic settings and socially constructed online worlds. A review is provided of the current and prospective research methods that researchers use to capture, document, and study the compelling ways in which children and young people are using digital technologies such as Information and Communication Technologies, social networking software, video games, multimedia authoring tools, and mobile phones in everyday life to learn and play. The paper argues for a need to study the authentic, inventive, and emergent uses of digital technologies and interactive learning environments among youth to contribute to advancement of theories of everyday learning and to build a deeper understanding of how learning occurs in out-of-school settings from a practise-oriented perspective rather than a knowledge-centred one. Implications for instructional practise are also discussed in addition to ethical and pragmatic issues that will need to be addressed in the study of digital kids. (Contains 1 table and 1 note.)