The Harry Potter books, of course, paved a broad motorway through the landscape of children's fantasy literature and inspired countless authors to join the gold rush. Some of these books are derivative and forgettable; some, like the Percy Jackson series, have become phenomenally popular in their own right.
If you are looking for a good read in this genre with at least a little literary merit, you could do far worse than the Children of the Lamp series by P.B. Kerr. Start, please, at the beginning with The Akhenaten Adventure, which introduces the hero and heroine, John and Philippa Gaunt, 12-year-old twins who discover they are not human, but Djinn. A rollicking adventure quickly follows with their Uncle Nimrod, who instructs them in Djinn lore and the proper appreciation of the Romantic poet Keats. The series has 6 books at present; I believe the author is aiming for a total of 7 in the grand tradition of other British children's authors with two initials instead of a first name. It helps to read these books in order: although they could be self-contained, the world of the Djinn is unusual enough that it requires more exposition than normally found in children's books. Book 2 is The Blue Djinn of Babylon; 3 is The Cobra King of Kathmandu; 4 is Day of the Djinn Warriors; 5 is The Eye of the Forest.
The latest installment is The Five Fakirs of Faizabad, in which John, Philippa, Nimrod and his insular butler Groanin encounter an alarming decrease in the world's luck and must take extraordinary measures to correct it. Kerr's plots are incredibly inventive, possibly reflective of authorial ADHD, but in a mostly good way. In this one novel we encounter philosophical introspection about the nature of happiness, a fearsome grizzly bear, a Jinx who is really a Sasquatch, Nazis engaged in a quest for eternal life, a steely elderly woman known as "Mu" who is one of Britain's foremost spymasters, and the legendary Shangri-la. After all that imagination -- and more -- it is a bit of a disappointment to come to the ending of this book. Without dishing out spoilers, I'll just say that the Eastern mythology from which the author draws is more circular than linear. But we are in good hands and Kerr is more than qualified to bring the series to a satisfying conclusion when he finally gets around to it, whether that's one book or many books away.
Cautions: Some parents may share the same types of concerns as have been voiced about the potentially occult elements of the Harry Potter books. It may actually be a bit more troubling to some because of the associations with Eastern mysticism. Personally, I'm willing to suspend disbelief and accept that the author is using concepts such as reincarnation and spirits temporarily leaving the body or possessing other bodies as plot points rather than religious propaganda: it helps that Kerr treats religion with respect and frequently lampoons the kind of new-agey goofiness that passes for modern "spirituality." But it's a fine line and if you're uncomfortable with the witchcraft and wizardry of Harry Potter you will likely have the same reaction to these books.