You could say this was the Book Festival of laughter and not forgetting.

And by not forgetting I mean a number of things. There was the not forgetting the Great War and all the horrors of wars since, which inevitably featured this year. But also, there was the not forgetting, or not excluding, those people who often don't feature in children's fiction: the ethnic minorities, the gays, the people with disabilities and traveller children.

One of the biggest stories of this year's children's and young adult programme of the Edinburgh International Book Festival has been the children's laureate Malorie Blackman, who drew attention to what is sadly absent in the book market for the young, saying that she would like to see more fictional children from minority groups. Speaking at the festival, she said: "I think there's a very significant message that is sent out when you do not see yourself at all in the books you're reading, in the cultural world. I think it is saying, 'you may be here, but do you actually belong?'"

It is, of course, possible to see what she says all the way through the market, from pre-school to young adult. I have two boys, two white sons, and books featuring them are still myriad. Indeed, if it weren't for Blackman I probably wouldn't have thought about who we don't see. There was plenty, for instance, on the programme for girls: from Jacqueline Wilson and the slew of female authors writing fantasy for young adults.

The children's book festival is a testimony to a vibrant sector of the book industry. Earlier this year The Bookseller reported that the pre-school and picture books genre has grown every year since 2001. Janet Smyth, director of the book festival's children's programme, says that almost all pre-school events sell out. Smyth believes that is partly "because parents are really quite keen on the whole reading together thing". But also because many of these events feature singing and "make and do". Julia Donaldson has long been reeling in audiences with this kind of show, but almost as big a lure was Kristina Stephenson, author of Sir Charlie Stinky Socks, a writer-illustrator who Smyth describes as "a show-maker who packs them out, and entertains the little ones with singing and dancing".

Sometimes it seems as if the ideal children's book festival event is some kind of kid-friendly gesamtkunstwerk involving singing, talking, reading, drawing, and possibly glue. James Mayhew, the illustrator in residence, is also a musician who dresses up as Van Gogh. Aidan Moffat, formerly of the band Arab Strap, presented his rhyming tale of The Lavender Blue Dress, while the young audience busied themselves creating a dress design. I can see why words are not enough. My kids get restless after more than a few minutes of just talking. After 10, they're hunting around inside my handbag for entertainment.

Smyth has also observed that this year more people are moving from different art forms into children's literature. Since David Walliams became the new Roald Dahl, it seems that many a comedian has turned his or her talent to children's books. Among those at this year's Book Festival were Mackenzie Crook, Catherine (Catie) Wilkins and David O'Doherty. The connection works for two reasons. One: they're often famous, which helps sales. Two: they're funny. And, as Roald Dahl once said of children's writing, "It's got to be funny."

And it's not just the restless little ones who like pictures. Even with older readers, art work is as much the draw as words. Sally Gardner's Tinder, for instance, is a dark adaptation of Hans Christian Andersen's The Tinderbox, a coming-of-age book for young people navigating a world of darkness and horrifying news stories, set during the Thirty Years' War. Her book is hauntingly illustrated by David Roberts. Gardner, also an illustrator, complains how she dislikes the "books for adults with not one blooming drawing in it".

Another growing genre is illustrated non-fiction. One of the advance sell-outs of the Book Festival was Gill Arbuthnott's book for six to 10 year olds on DNA, What Makes You You? Many of the non-fiction works make for stunning visual events. Images from William Grills's Shackleton elegantly brought alive the dramatic story of the polar adventurer. Even the end papers of James Robertson's Robert The Bruce: King Of Scots seemed a thing of beauty and a reminder of what's special about paper in the ebook age. Barroux's Line Of Fire was also non-fiction, based on the moving diary of a real French soldier. One of the thrills was watching a projection of him drawing and describing how he came upon his soldier's nose, a beaky triangle.

This year's Book Festival also speaks of a lucrative young adult market. This section of the programme has its own listings, since, says Smyth, young people over 12 won't look at anything with the word "children" on it. Smyth notes that among the trends within the young adult sector is a wave of fantasy and dystopian fiction written by women, often feeding the appetite for dark fiction which drove the sales of Twilight and The Hunger Games: Sarah J Maas, Moira Young (Carnegie prize winner), Sally Green, Lucy Saxon, Claire McFall and Leigh Bardugo.

Among our most successful young adult authors is two-time Carnegie winner Patrick Ness. In a lecture, Ness echoed Malorie Blackman's statements on the need for greater diversity. He eulogised about Doc McStuffins, the Disney animated series featuring a black girl who wants to be a doctor. Examining the question of why he wrote for young people, he said he felt books for the young should "show you the world and all that's possible in it - and that you're not alone". Ness noted that in his own teen years, growing up gay in a religious community in Washington there was very little to tell him he was not alone.

Blackman and Ness are themselves indications that things are changing. The fact that they were two of the most dominant voices at the children's festival tells us that. But the pace is slow.