Children’s ethnic-racial identity formation is a critical aspect of their development and has implications across the lifespan. However, there has been limited attention to children’s ethnic-racial identity formation, especially among young children of color. This paper provides the current evidence of ethnic-racial identity formation in the early years (ages 0-8). Guided by the literature primarily focused on older age youth, there is growing evidence of the importance of ethnic-racial identity for young children’s cognitive and social-emotional development, school engagement and success. The early years are a sensitive period for the formation of positive ethnic-racial identification because it is during these years that personality is first formed, so this is an opportunity to grow the evidence and, more importantly, include it as a critical outcome for children’s healthy development and an area for inclusion on national, state, and local indicators of child well-being and worthy of intervention and support. In addition to noting gaps and opportunities for innovation, we call on the need for a cohesive infrastructure, such as a research-practice partnership, focused on developing and implementing a plan that strengthens the research evidence while also integrating ethnic-racial identity and factors that support this outcome in quality rating systems and standards and professional development systems. (author abstract)