Childcare services represent a valuable obesity prevention opportunity, providing access to a large portion of children at a vital point in their development. Few rigorously validated measures exist to measure healthy eating and physical activity policies and practices in this setting, and no such measures exist that are specific to the childcare setting in Australia. Methods: This was a cross sectional study, comparing two measures (pen and paper survey and observation) of healthy eating and physical activity policies and practices in childcare services. Research assistants attended consenting childcare services (n = 42) across the Hunter region of New South Wales, Australia and observed practices for one day. Nominated Supervisors and Room Leaders of the service also completed a pen and paper survey during the day of observation. Kappa statistics and proportion agreement were calculated for a total of 43 items relating to healthy eating and physical activity policies and practices. Results: Agreement ranged from 38%-100%. Fifty one percent of items showed agreement of greater than or equal to 80%. Items assessing the frequency with which staff joined in active play with children reported the lowest percent agreement, while items assessing availability of beverages such as juice, milk and cordial, as well as the provision of foods such as popcorn, pretzels and sweet biscuits, reported the highest percent agreement. Kappa scores ranged from -0.06 (poor agreement) to 1 (perfect agreement). Of the 43 items assessed, 27 were found to have moderate or greater agreement. Conclusions: The study found that Nominated Supervisors and Room Leaders were able to accurately report on a number of healthy eating and physical activity policies and practices. Items assessing healthy eating practices tended to have higher kappa scores than those assessing physical activity related policies or practices. The tool represents a useful instrument for public health researchers and policy makers working in this setting. (author abstract)