My 4yo can read a digital clock but she doesn't understand the concept of time yet. She does know that when the big hand on the analog clock is on 10 that it's time to leave for school (when I tell her within the hour that it's time to go...she watches it for me).
My older kids learned in 2nd grade so around 7 years old. My almost 10yo still has trouble with it (I did, too, at her age). My son is 8 1/2 and is a whiz at telling time. He picked it up really fast and easily. My 7yo (just finished 1st) knows the basics...hours and half hours but that's it. She can read a digital, though.
at 3:34 PM on Jun. 12, 2010