Physical inactivity in children is a global pandemic in parallel with increasing obesity prevalence. However, studies assessing the association between physical activity (PA) and body composition (BC) report conflicting findings, possibly because of the different methodologies across studies, with objective methods promising reliable results. This study determines the association between objectively determined PA levels and BC in 6–8-year-old children from a black South African population. Ninety-three children aged 6–8 years, who formed part of a larger study on BC using the deuterium dilution method (DDM), were included. Height and weight were measured according to the standard procedures, and body mass index z-score was calculated. Fatness was determined by DDM. An accelerometer was used to measure PA levels. Regression models were performed to determine the relationship between PA and BC. Approximately 23% of the children did not meet the recommended PA guidelines and 27% were overfat. After adjustments were made, more time spent in vigorous PA was significantly associated with lower fat mass (β = −0.25, p = 0.01, 95%CI: −11.08; −1.20) and fat mass % (β = −0.20, p = 0.04, 95%CI: −12.63; −0.18). Participation in high PA, especially of high intensity, was associated with reduced adiposity in children. Behavioural changes such as increasing high intensity PA is strongly recommended for reducing adiposity.