If early childhood systems are to be effective at the population level then they must be able to provide family-centered care to all the racial, ethnic and cultural groups that they serve. Despite major policy driven and technological advances in healthcare, health disparities across different races and ethnicities persist. For example, the infant mortality rate of African-American babies remains at about twice that of White or Hispanic babies. Although multiple factors probably contribute to these disparities, there seems little doubt that providing health services which are culturally sensitive and effective across all races and ethnicities would decrease gaps in health and developmental outcomes. The term "cultural competence" has been used to describe responsiveness to diversity at the system, organizational, and individual level. The focus on conceptualizing and addressing cultural competence as a quality of care issue has moved the discussions around culture and healthcare delivery out of an abstract theoretical perspective into the mainstream of healthcare delivery systems. Increasingly, service systems are being judged not only on whether they provide care that is accessible, appropriate, capable, continuous, coordinated, acceptable and effective, but also on whether those services, across all of the key parameters, are culturally proficient. This report, geared toward State Early Childhood Comprehensive Systems (SECCS) grantees, explores what it means for services to be culturally competent and how to work toward enhanced levels of competence. In doing so, policymakers will improve the quality of services not just for children who are members of ethnic minority groups, but for all of America's children. (Contains 1 table and 3 exhibits.) [This publication was produced by the National Center for Infant and Early Childhood Health Policy, an active collaboration between the UCLA Center for Healthier Children, Families and Communities, the Association of Maternal and Child Health Programs (AMCHP), the Women and Children's Health Policy Center at the Johns Hopkins University Bloomberg School of Public Health, and the American Academy of Pediatrics (AAP).]