California requires that all individuals under the age of 18 wear a helmet when on a bike, bike trailer, scooter, skateboard, etc.
While there is much debate about the efficacy of helmets (and more specifically, helmet laws) I think they are an incredibly valuable device. As one having previous experience with being hit by a car (and thrown off my bike), I'm sure my helmet spared me an unwelcomed bonk on the head and road rash.
For infants/toddlers, your options are pretty limited. Unfortunately you have to throw aesthetics to the wind because the designs are borderline gaudy.
There is a pretty decent selection of kids helmets at REI online. BUT - you can't see how well the helmet fits unless you are trying it on in person. If you are committed to an online purchase, most helmets specify what head circumference the helmet can accomodate, and since most regular checkups to the doctor now provide this measurement - getting a good fitting helmet has never been easier.
We opted for the Giro Spree Bike helmet for Toddlers. The graphics are repugnant but the fit is pretty good and it has blinky lights on the back, which is a nice bonus safety feature for night riding.
As you can see - first impressions were good.
In the trailer, it did prove to be a little more prone to slipping over his eyes. This could probably be solved by tightening the chin strap. The golden rule for chin strap tightness is "two fingers." You should be able to fit two fingers (aligned vertically) between your chin and the helmet strap. So, for kids helmets - is that kid fingers or adult? Probably kid. : )
When it comes to helmets and with most things... I think getting kids started early and setting an example by wearing one yourself, will ensure a long healthy relationship with your kids, helmets, and bicycling.