Infestation of the head louse Pediculus humanus var capitis DeGeer (Phthiraptera: Pediculidae) is an important public health problem in Australia, with up to a third of children infested in some primary schools. Insecticide resistance and inadequate attention to the application instructions of topical pediculicides are common reasons for treatment failure. This study evaluated six popular Australian over-the-counter products against head lice, primarily comprised of different botanical extracts, and compared them with permethrin 1% (Quellada®) and non-treatment control in order to assess their in vitro efficacy. We also assessed commonly used criteria for evaluating pediculicide efficacy in vitro. All tested products failed to demonstrate high levels of efficacy with the exception of Tea Tree Gel®, which outperformed 1%permethrin. Permethrin had a high level of efficacy, but using stringent criteria 18% of lice were not dead at 3 h, indicating some resistance to Quellada®. Commonly used less stringent criteria were shown to overestimate mortality of head lice as a result of the protective phenomenon of stasis or sham death observed in exposed lice that may recover after some time. Using two different levels of stringency resulted in different rankings of efficacy for most products, with the exception of the first ranked product, Tea Tree Gel®. Rankings of efficacy also varied over time, even within the different assessment criteria. Government regulatory agencies should require standard in vitro tests using stringent mortality criteria, with an observation period of ≥ 6 h, to determine the efficacy of new pediculicides, and only products that cause a minimum mortality rate (e.g. 80%) in head lice collected from the target population should be licensed for sale.