The global childhood trend towards obesity and unhealthy lifestyles is a growing concern. Childcare settings have been identified as the most influential factors for children's physical activity, and physical activity habits are better formed and maintained if started in early childhood. As a result, early childhood education environments are in an excellent position to enable physical activity interventions, and are optimally placed to promote physical activity in order to reverse the obesity and physical inactivity trends. Yet, there is still ignorance and misunderstanding of the role that physical activity plays in early childhood education. The purpose of this paper is to review current physical activity issues, to re-evaluate the specific benefits from regular physical activity, and to offer guiding recommendations to improve physical activity in early childhood education. Future research directions are also provided. It is our hope that early childhood education can play a proactive role in the development of healthy active lifestyles, and that all young children can fully benefit from regular physical activities for their health and wholistic learning in all child care environments.