Putin, who is divorced, has two daughters, Katerina and Maria, and is famously reluctant to discuss them or any aspect of his own personal life.
"As for my grandchildren, one already attends nursery school," said Putin, when asked about his family in a televised question and answer session with voters ahead of a presidential election next year.
"The thing is I don't want them to grow up like princes. I want them to be normal people. And for that they need ordinary, normal communication with other children."
For that reason, he said he preferred not to disclose their names and ages.
"They would be immediately identified and not left in peace. It would damage the children's development. I ask you to understand me and to treat this position with understanding," he said.
Putin also touched on the subject of his daughters saying that, despite what he called rumours, they both lived in Moscow.
"My daughters are involved in science and in education. They don't interfere in anything, including politics. They live normally."
Reuters has reported that Putin's daughter Katerina works in a senior post at Moscow State University and that she has described herself as the spouse of Kirill Shamalov, a shareholder in petrochemicals company Sibur.
Kirill is the son of Nikolai Shamalov, a longtime friend of the president. Shamalov senior is a shareholder in Bank Rossiya, which U.S. officials have described as the personal bank of the Russian elite.
Reuters has also reported that a number of firms and individuals close to the Kremlin were providing support to a project Katerina oversees at the university, and to the All-Russian Acrobatic Rock'n'Roll Federation, in which she is involved.
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