Given how spread out Kitzbühel is it doesn’t make for the easiest destination for families. Added to this is the location of the nursery slopes at the bottom of the mountain.
This means that if your kids are first-timers you’ll be hot-tailing it all the way back down the mountain any time you need to check on them. This disadvantage can be balanced by the fact two of the lifts at the nursery slopes there are free. Jochberg, which also has a free lift, would be a convenient place for families to stay considering it has some good nursery slopes right in the center.
However, if your kids are more advanced and you don’t mind a bit of a schlep to the slopes, you’ll find Kitzbühel a memorable and magical place for a family ski vacation, especially since there are plenty of side activities to keep them occupied after the lifts close.