In July 1999 the House of Parliament in Cyprus passed the Education Act for Children with Special Needs, according to which all children have the right to be educated in their neighbouring regular school together with their age-mates. An important component of this law is that it introduces, for the first time, inclusive education into pre-primary education. A child can be considered as having special needs only when he/she has attained the age of 3 years or older. The purpose of this paper is to examine how the policy of inclusive education is implemented in pre-primary schools in Cyprus, to investigate whether some children are still marginalized (after the implementation of the new law) and, if they are, to identify factors influencing marginalization or acting as a barrier to inclusion. We also briefly present the results from a study we conducted that supports the discussion of the issues raised in this paper.