Learn French: Je cache ce petit jouet de crainte que le bébé ne l'avale. - I hide this small toy for fear that the baby swallows it.

It is grammatically in the subjunctive mood, because the conjunction de crainte que always triggers it. Since avaler is a regular -er verb, its present subjunctive form (avale) happens to look identical to the present indicative.

Why is there a ne before l'avale when the baby swallowing the toy isn't a negative action?

This is the ne explétif (an untranslated, non-negative ne). Certain expressions of fear or precaution, like de crainte que or de peur que, naturally trigger this extra word in formal or written French. It does not make the sentence negative, and you will often hear native speakers drop it in casual conversation.

Can I use de peur que instead of de crainte que here?

Yes! de crainte que and de peur que mean exactly the same thing (for fear that) and are used interchangeably. Both require the subjunctive mood and both can trigger the ne explétif. de crainte que just sounds slightly more formal.

Why is the direct object pronoun l' squeezed between ne and avale?