The event, held at the World Museum in Liverpool, was streamed to thousands of schools where pupils simultaneously conducted simple experiments.
The live link-up with the International Space Station lasted about 20 minutes.
Major Peake made history last month when he became the first Briton to walk in space.
See more updates about the space talk on our live page
Among the questions was: "What can you see out of the windows?"
Major Peake replied: "I have got a window right behind me - let me go take a look." The children laughed as he turned and floated away from the camera to look out of the window.
He added: "At the moment we are in the middle of the Atlantic Ocean coming up to the coast of Africa with the beautiful colours of the Sahara Desert."
There was a huge gasp of delight when his beaming face appeared on the screen in front of the young audience.
Standing in front of a union flag, the astronaut seemed to be in good spirits, demonstrating how you touch your toes in space - turning upside down in a backward roll as the children laughed.
Matthew Savage, 10, from St Anne's Fulshaw CE Primary School in Wilmslow, Cheshire, asked if he got hit by meteors on the International Space Station.
Major Peake replied: "We do get hit by small particles every day and they have even caused some damage. On space walks we have to be careful where we put our hands." He said the "clever people on earth" made sure they were safe.
He said he liked experiments involving vegetables and flowers grown in space the most. "We are going to need that information for longer missions on Mars," he said. He also liked experiments on the human body because they could have health benefits back on earth.
"Does your heart beat faster in space?" asked Riley, aged five, from Wilberfoss Primary School in York.
"It actually slows down and would shrink if you didn't regularly exercise." he replied. He explained this was why astronauts had to exercise regularly in space.
The call ended with rapturous applause from his young audience.
British astronaut Tim Peake has spoken to hundreds of children from across England and Wales in a live space chat.