The 14-year-olds enjoyed a romantic afternoon together at the festively-bedecked Grove mall in Hollywood on Sunday.
They reportedly flirted with one another at the LA premiere for Twilight: Breaking Dawn - Part One premiere on November 15.
Date: Kylie Jenner and Cody Simpson looked adorable as they strolled around The Grove complex in Hollywood yesterday
A source told Us Magazine: 'Yes, they went on a date.'
'I would say they are dating,' the mole concluded. 'They are a couple! They are so cute together.'
Cody is the voice behind the cover of I Want Candy that accompanied this Easter's animated bunny caper, Hop.
'I'm having a great time!': Kylie chats into her mobile as she and Cody walk past Santa's Grotto
Reluctant to part: The couple still looked content as the sun set and The Grove took on a magical atmosphere
The Gold Coast boy relocated to Los Angeles last June with his family to further his career.
So it'd surely be nice for the fish out of water to have a relationship with a native Angeleno like Kylie.
And it's arguably good timing for the Kardashian clan, who could do with the innocence of a blossoming relationship after Kylie's big sister Kim, 30, and the disaster that was her marriage to Kris Humphries, 26.
And Kylie, along with her big sister Kendall, 16 , are slowly becoming the sisters to watch, especially as their modelling careers progress.
The look like caught his eye: This was the night when Kylie (right) is said to have struck up a rapport with Cody, she was escorted by her sister Kendal
And the fashion-conscious teenagers have been rewarded for their efforts by winning a Hollywood Style Award, which was presented to them by their sister Khloe, 27.
Writing on their blog, Kylie said: 'It was so crazy and surreal that we were honored with the Stylish Sisters Award - such a special moment for us BOTH, especially since Khloé was the one to present us with it. What an incredible night!'