Rubbish burning is the bigger day to day issue for most families. Away from the main tourist strips, municipal waste collection is patchy, so a lot of households, warungs, and even some villas burn their trash, plastic included, in a yard or empty lot nearby. This tends to happen in the late afternoon or evening, so that's when you'll smell smoke drifting through a neighborhood, especially in residential pockets of Canggu, Ubud, and the rice field fringes. It's more noticeable in the dry season, roughly April to October, when there's no rain to clear it out.
On top of that there's ordinary traffic pollution, which is worst in congested spots like central Denpasar, Kuta, and Seminyak during peak hours. In some dry season stretches a haze can also settle over the island from wider regional burning further afield. None of this is unique to Bali, but young children are more sensitive to it than adults: they breathe faster relative to their size, their airways are narrower, and their lungs are still developing. If your child already has asthma, eczema, or another sensitivity, it's worth being a bit more careful here than you might be at home.
Most expat families manage it with habits rather than avoiding Bali altogether. Look at what surrounds a rental before signing a lease, a house tucked behind an open burning lot or right on a busy road will smell it more than one set back with some tree cover. Keep windows closed and run a fan or air purifier in the evening if smoke drifts in, check a free air quality app on smoggy looking days before long outdoor sessions, and get a lingering cough or wheeze checked by a pediatrician rather than assuming it's just a cold. Most kids adjust fine, but it's a real factor worth planning around, not something to dismiss.
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