Physical Literacy and Physical Activity in Early Years Education: What’s Known, What’s Done, and What’s Needed?

Background: Physical literacy (PL) is increasingly recognised as essential for fostering lifelong engagement in physical activity (PA), particularly when nurtured in early childhood. Yet there remains limited understanding of how stakeholders in early years (EY) education perceive, value, and implement a PL-informed approach. This study aims to explore knowledge and beliefs regarding PL and PA in relation to 3–5-year-olds, investigating key questions around perceived importance, current practices, and barriers to implementation. Methods: A concurrent mixed-methods approach was used, incorporating semi-structured expert interviews (n = 11), focus groups (n = 22), and a survey (n = 210). Thematic analysis was used to identify key themes from qualitative data, and survey data were analysed to complement and triangulate the qualitative findings. Results: The findings revealed variation in stakeholders’ awareness of PA recommendations and confusion over terminology. Whilst stakeholders acknowledged the importance of PL, there remains uncertainty about the connection between theory and practical application. Identified barriers included resource limitations, conflicting priorities, and insufficient training and policy support. Feedback on an educational PL-EY model was generally positive, suggesting strong potential as a tool to support PL understanding and application in early childhood contexts. Conclusions: Given the pivotal role of EY education in shaping children’s behaviours, health, and wellbeing, this study highlights the necessity of a holistic approach to interventions, strong stakeholder involvement, and evidence-based practices to foster PL in EY children. The PL-EY model presents a promising direction for future resources and education and raises critical questions about what effective interventions to develop PL in this age group should consider and look like.