Children learn new words and word forms with ease, often acquiring a new word after very few repetitions. Recent neurophysiological research on word form acquisition in adults indicates that novel words can be acquired within minutes of repetitive exposure to them, regardless of the individual's focused attention on the speech input. Although it is well-known that children surpass adults in language acquisition, the developmental aspects of such rapid and automatic neural acquisition mechanisms remain unexplored. To address this open question, we used magnetoencephalography (MEG) to scrutinise brain dynamics elicited by spoken words and word-like sounds in healthy monolingual (Danish) children throughout a 20-min repetitive passive exposure session. We found rapid neural dynamics manifested as an enhancement of early (~100 ms) brain activity over the short exposure session, with distinct spatiotemporal patterns for different novel sounds. For novel Danish word forms, signs of such enhancement were seen in the left temporal regions only, suggesting reliance on pre-existing language circuits for acquisition of novel word forms with native phonology. In contrast, exposure both to novel word forms with non-native phonology and to novel non-speech sounds led to activity enhancement in both left and right hemispheres, suggesting that more wide-spread cortical networks contribute to the build-up of memory traces for non-native and non-speech sounds. Similar studies in adults have previously reported more sluggish (~15–25 min, as opposed to 4 min in the present study) or non-existent neural dynamics for non-native sound acquisition, which might be indicative of a higher degree of plasticity in the children's brain. Overall, the results indicate a rapid and highly plastic mechanism for a dynamic build-up of memory traces for novel acoustic information in the children's brain that operates automatically and recruits bilateral temporal cortical circuits.