In three experiments, we investigated the role of automatic and controlled inhibitory retrieval processes in true and false memory development in children and adults. Experiment 1 incorporated a directed forgetting task to examine controlled retrieval inhibition. Experiments 2 and 3 used a part-set cue and retrieval practice task to examine automatic retrieval inhibition. In the first experiment, the forget cue had no effect on false recall for adults but reduced false recall for children. In Experiments 2 and 3, both tasks caused retrieval impairments for true and false recall, and this occurred for all age groups. Implicit inhibition, which occurs outside of our conscious control, appears early in childhood. However, because young children do not process false memories as automatically as adults, explicit inhibition can reduce false memory output.