"Learning the language is a vital key for integration. This new app represents a major step in promoting language-learning," Education Minister Gabriele Heinisch-Hosek said on Thursday.
The "hallo App Deutsch" contains 1,000 everyday words as well as pictures and sound, something which will help kids who can't yet read roman script.
The app, co-funded with corporate sponsorship, is also set to be launched in Germany - the main destination for refugees in recent months - and a version for adults is also planned.
The kid's version will be available for free download from the iTunes App Store and the Google Play Store from the end of October.
Austria has seen more than 200,000 refugees enter the country since the beginning of September, most of whom travel onwards to Germany or Scandinavia.
But the government still expects some 85,000 asylum claims this year, making the Alpine country of 8.5 million people one of the highest recipients in Europe per capita.
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Concerns about the inflow have boosted support for the far-right Freedom Party (FPÖ), which is leading in opinion polls nationally with more than 30 percent of the vote.
Surveys indicate that the FPÖ might come first in elections in Vienna on Sunday, a first in a European capital and which would put Chancellor Werner Faymann under severe pressure.