Early childhood care and education (ECCE) has a crucial contribution to the future life of children, and overall quality of learning and development of a country. Even though there are no well-established international criteria to evaluate the quality of ECCE programmes because of the variability in nations’ economies, workforces, political regimes and cultures, there are some common standards. Therefore, the purpose of this review article is to assess the status of ECCE in Ethiopia and its contribution to quality education. This review is based on a document analysis from different sources (i.e. policy documents, books, journals, theses and dissertations). The study focuses on identifying common quality indicators/dimensions for ECCE and the challenges that Ethiopian ECCE faces in terms of these dimensions. Indicating that the practice of ECCE in Ethiopia is faced with diverse challenges. Some of the challenges are lack of proper training for teachers and caregivers; use of developmentally inappropriate curriculum; lack of pedagogical skill; unfavourable working conditions; inadequate resources; lack of continuous supervision and programme evaluation; inactive parental and community participation; ineffective school organisation and leadership; imbalanced staff-child ratios; and improper healthcare and hygiene. Therefore, the Ministry of Education (MoE) in partnership with the Ministry of Health (MoH), the Ministry of Women’s Affairs (MoWA), the community and other concerned bodies should work together to improve the practice of ECCE.