the Fatwa Department Research Committee - chaired by Sheikh `Abd al-Wahhâb al-Turayrî
The only issue at hand would seem to be that of imitating animals. Scholars have determined that, as a basic rule, imitating the appearance and behavior of animals is dislike or even impermissible.
They argue that whenever we find human being compared with animals in the Qur’ân and Sunnah, it is always as a means of derogation.
For example Allah says: “So his parable is as the parable of the dog; if you attack him he lolls out his tongue.” [Sûrah al-A`râf: 176]
Allah also says: “The likeness of those who were charged with the Torah, then they did not observe it, is as the likeness of the donkey bearing books.” [Sûrah al-Jumu`ah: 5]
However, this ruling applies when the imitation of animals implies derogation, insult, or a loss of dignity. The estimation of this depends on the nature of the imitation itself as well as the context, both specific and cultural, in which it takes place.
We see that the Prophet (peace be upon him) played with his grandchildren by giving them pretend horse or a camel rides. He would get on all fours and allow his little grandsons, al-Hasan and al-Husayn, ride on his back. He then said to them: “What a fine steed you have.” [Mu`jam al-Tabarânî with a good (hasan) chain of transmission.]
In some narrations, he is quoted as saying to his grandchildren: “What a fine camel you have and what fine gentlemen you are.”
This shows that imitating animals is not forbidden under all circumstances. Here the context is play with one’s children. It is well known way that fathers play with their small children at home and it is perfectly acceptable in most societies.
The same considerations apply to children painting their faces at parties. It is merely an amusement engaged in by children on those special occasions. It implies no shame or loss of dignity for those children in the broader social context.
Therefore, face painting for children at parties and on other festive occasions is comparable to the Prophet’s behavior with his grandsons. It is permissible.
And Allah knows best.
Source: Islam Today