Prince Harry, who has Archie, three, and Lili, 11 months, with wife Meghan, hopes his children never have to experience social media in its current form.
The Duke of Sussex slammed online companies for designing platforms "at the expense of young people" and insisted it is impossible for parents to protect their children from harm on the Internet.
Harry claimed children are "targeted and fed dangerous content" when they go online and are "treated as digital experiments to make money".
Speaking via Zoom for the launch of a toolkit called Making Child Online Safety A Reality, he said: "Many of these systems are by design aiming to keep our kids hooked for years to come regardless of how their time online impacts their self-confidence, self-worth or safety."
Harry acknowledged he isn't "an expert on law or technology", then added: "But I am a father and I'm lucky enough to be a father with a platform.
"My kids are too young to have experienced the online world, yet. And I hope they never have to experience it as it exists now. No kid should have to.
"It's easy to say the business model of the internet and social media is broken, but it's not. The internet business model is doing exactly what it's meant to do - pull us in, keep us scrolling, get us angry, anxious or make us numb to the world around us.
"That's bad enough when it's meant for adults, but even worse, it's meant to do the same to our kids. The social media industry makes unimaginable money from our time, our attention and our information, literally.
"Their financial model is based on keeping us online and engaged so they can vacuum up our most personal information and time."
Harry insisted it is time to "understand that the way we experience technology like social isn't working and needs to be fixed".
The prince doesn't think he can keep his kids away from "online harms" forever unless "meaningful" changes are made.
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He said: "My two little ones are still of the age of innocence. Sometimes, I feel I can keep them away from online harms they could face in the future forever, but I'm learning to know better.
"I'm learning that without meaningful change to the way we hold technology accountable and approach designing technology in the future, we will not be able to stop our kids being subjected to addictive products where they are exposed to content they should never see and experience and should never have to go through."
Harry called for new laws, in combination with public pressure, strong leadership, and "continued research into what some of the biggest companies in the world are hiding behind closed doors".
He added: "It shouldn't have to take a whistleblower or other disturbing revelations to learn what social media companies have known for a long time: that their platforms are designed at the expense of young people.
"As parents, my wife and I are concerned about the next generation growing up in a world where they are treated as digital experiments to make money, and where things like hatred and harm are somehow normalised.
"None of us wants a world where their kids are targeted and fed dangerous content rather than being able to learn, connect and play freely.
"We want our children and all children to feel empowered to speak up and call for change when older generations are not capable of seeing, or choose to ignore, all the ways new technology is shaping society."
The toolkit was launched by 5Rights Foundation, with support from the African Union, the United Nations Committee on the Rights of the Child, the European Union and other global children's rights NGOs.
The report calls on countries to establish a child online safety policy, with world leaders asked to commit on the international stage.
