You need some one-to-one help immediately.  This sounds serious especially since there are kids involved.  Get yourself a decent behaviour advisor/trainer straight away from one of these organisations:
www.apdt.co.uk
www.apbc.org.uk
www.ukrcb.co.uk

You could try to sort the problem out yourself using one particularly good book that's available on the market but I really think you should have someone experienced to help and guide you.  The risk with the kids is just too great to take any chances.

Marion

P.S. Don't let anyone tell you he's being 'dominant'.  He is almost definitely resource guarding.
P.P.S. Until you get one-to-one help, don't let anyone near him while he's eating!

Thank you Marion and Taylor i will try those things!

Hi

Is it in a very busy area of the house where your dog eats his food?  I ask because it seems that dogs will guard their food if they are used to it being threatened.

My own dogs are very relaxed with me being around them when they are eating, I think because I simply let them get on with eating after I have put their food down and so they don't see me as a threat to their grub! Is your dog allowed to eat in peace once his food has been put down for him?

Having said what I have about my dogs, I'm afraid I wouldn't trust either of them an inch not to take the opportunity to snatch food off a small child visiting my house, as they are dogs after all I suppose .  So my dogs are not allowed in the same room as any kids who visit, when the kids have food.  Could you do this perhaps?

I definitely agree with Marion's advice to let him eat his food in peace when you have given it to him.  I would probably also get annoyed if I started to eat my dinner, only to be interrupted or have it taken away from me!

You could teach him to give things to you in your hand like toys. Start off by swapping one toy for another making sure what you have to give him is of greater value, you could make a game of it so hes used to you handling his stuff once hes happy to give things up on demand you could try to introduce food with him taking it from you but make him wait untill you say he can have it (but not too long) but he has to be gentle. The aim is for him to completely trust you so he doesnt see you as a threat. Once he trusts you another idea is when you feed him hold a little of his dinner to one side then when hes nearly finished add the rest to his bowl and leave him, hopefully he should see you as the giver of food not the taker. Dont let the kids do this as it could confuse him. You will know if this will work for your dog. its just an idea i thought of

do you eat first at meal times if no
then start
as this is telling him you are his leader the alpha dog
after all the dog is a pack animal and the alpha dog always eats first
putting him in the correct position in your house hold

if you feed him in doors then do it after the children go to bed or whilst they having a bath watching tv ect
or
feed him in the garden

but also get help from a behaviorist as MARSIPAN said

but following simple instructions in the feed time & the help of a  behavioist i agree with

if fearful where the children are which you are !!
then i would  keep the dog away in the garden or in another room whilst the children have food in their hands then allow him back in once the children have fininshed eating
sweeties or anything

good luck i hope you solve the problem

sorry i beg to differ

every one has there own believes and i'm sure they can make their own minds up

mine was just a suggestion this is my belief and this doe's work within my dogs

I QUITE UNDERSTAND WHAT YOU ARE SAYING BUT HERE IS AN ARTICAL PUBLISHED ON CANINE CONCEPTS UK

Why is my dog aggressive to humans ? briefly discusses the background to pack hierarchy and how instability in this can result in dominance aggression. This article looks at the positive actions you can take to estabish yourself as the packleader and bring harmony to your pack.

To your dog, all members of your family are members of the same pack as they are. Both for your dog and families well-being, it is essential that your dog quickly understands that its rank is right at the bottom of the pack hierarchy. This way they will be more complient to commands and generally better behaved, and as a consequence be more of a pleasure to include in family activities.

Establishing yourself as the pack leader helps enforce ranking hierarchy and ensure your pack operates in harmony. Despite popular opinion, this does not mean bullying your dog. Being the pack leader means taking responsibility for pack decisions, protecting the pack and ensuring stressful situations are avoided or resolved. There are a number of very positive actions you can take to establish yourself as the pack leader. It is important to start these as early as you can, ideally when your dog is still a puppy. It may not be necessary to take all the measures outlined below, but you must be consistant in those that you impose. :
LIKE I SAY WE ALL HAVE OUR OWN VIEWS ON THIS

DONT WISH TO FALL OUT WITH ANYONE SO LETS LEAVE IT THERE AND ALLOW PEOPLE TO DECIDE WHAT THEY BELIEVE IN
REGARDS
LESLEY

PS
OUT LINED BELOW IS THE REST OF THE ARTICAL

In games of strength (eg. Tug-o-war) ensure you win more than you lose. This sends a signal that you are the stronger member of the pack.
When you play possession and chase games, use a set of toys that you can remove from your dog at the end of the game. Your dog can associate possession of priviledged items with higher ranking. Taking the toys from your dog at the end of the game sends a clear signal that they do not own the items.
During play sessions, teach your dog to release toys at your request. Thus reinforcing the earlier point that you are the owner of the toy and can request it back at anytime.
Stop playing and remove the toy immediately if your dog touches your hand with its teeth or begins to growl aggressively or get over excited.
Dominant dogs always have the best sleeping places, usually higher up than the rest of the pack. Reinforce your status and don't let your dog sleep on your bed or furniture.
Doorways represent entering new territory. Don't allow your dog to walk through doors ahead of you.
Make areas of your house no go areas. Allowing your dog into these areas should be a privilege for good behaviour and not a right.
Your dog should know that you own all territory. If your dog is lying in the way, ask them nicely to move, don't walk around them.
Higher ranking pack members eat first, so ensure your dog eats after you and DO NOT feed them tip bits while you are eating. Not only does discourage your dog from scrounging, it also reinforces the fact they only eat after you.
Don't always respond to your dogs requests for attention. The pack leader will initiate most grooming and petting interactions. On occassions, be aloof to requests for attention by your dog, don't tell them off, just ignore and don't speak to them.
Never allow your dog to take up superior positions, such as putting his paws on your shoulders. Walk off and ignore this behaviour if it occurs.
Always be consistent over time in your approach to any of the above. Dogs will notice and may exploit changes that it considers weaknesses.
Always be consistent in all locations, be they in the house or outside, at home or away from home.
Finally, and most importantly, every member of your family most stick to the agreed measures to ensure your dog understands that everyone in the family is more important than he is.