The Association of Educational Psychologists (AEP) fears that a new manual, designed to help medical professionals diagnose mental health problems, is too vague and open to misinterpretation.
Kate Fallon, general secretary of the AEP, said that while teachers and parents are often relieved when young people in their care are diagnosed with a condition such as depression or attention deficit hyperactivity disorder (ADHD) and given medication, this can mask underlying problems in their home life.
The latest version of the Diagnostic and Statistical Manual of Mental Disorders (DSM-5), drawn up by experts in the US and due to come into effect in the UK next May, could lead to "many, many more children and young people being diagnosed with psychiatric disorders", Ms Fallon said.
At its annual conference in Brighton last week, the Trades Union Congress (TUC) backed a motion calling on the National Institute for Health and Clinical Excellence (Nice) and the Department of Health to issue "clear guidance to all health practitioners about (DSM-5's) limitations".
"If we can't stop it coming out, we can at least advise people to be cautious about how they are using it," Ms Fallon told TES.
"There seems to be a growing motivation to have a medical diagnosis placed on a child. It can make the parent feel better or the teacher feel better. It doesn't find the underlying causes behind the issue, but it's easy to say, it's a label, and it sometimes helps the family get disability living allowance or the school be allocated extra educational resources."
The increasing diagnosis of children with psychiatric conditions is reflected in rising prescriptions of methylphenidate hydrochloride, the generic name for Ritalin. Prescriptions for the drug, commonly used to treat ADHD in children, increased from 158,000 in 1999 to 661,463 in 2010, according to NHS figures.
The manual is widely used by psychiatrists and GPs in reaching diagnoses on mental health problems. The AEP fears that the "broadened definitions" of psychiatric conditions in the new guidance could make children more likely to be diagnosed. "It means you wouldn't have to show as many symptoms or the same severity," Ms Fallon added.
Addressing the TUC conference, she told delegates that when children feel pressured, they demonstrate behaviours that tell the adults around them that "something is wrong", adding that this "may be too much pressure to achieve high grades in (their) exam, too much pressure to be very thin or very beautiful, to hang out with the cool kids or have all the latest gear".
This could lead, Ms Fallon said, to a shy child being "diagnosed with social anxiety. A sad, grieving or temporarily withdrawn child could be diagnosed with depression.
"We are worried that more children diagnosed with psychiatric disorders will lead to the increased use of drug therapy and long-term reliance on medication," she added.
Cathy Tattersfield, an executive member of the Association of Teachers and Lecturers and a teacher in a special school, told the conference that "quick-fix solutions ... don't provide long-term answers", and called for young people to be given "careful diagnosis and treatment".
The panel of experts that drew up DSM-5 for the American Psychiatric Association has also come under fire for its links to pharmaceutical companies, with 70 per cent of its members disclosing financial relationships with firms in the sector.
Both Nice and the Department of Health declined to comment.
A sad, grieving or temporarily withdrawn child could be diagnosed with depression
The prescription of Ritalin - widely used to treat ADHD - has soared in recent years: