The adoption of compensatory movement patterns occurs when limitations in mobility, stability, or motor control prevent proper motion from occurring. These dysfunctional movements may inhibit fundamental motor skill development and negatively influence perceived movement competence, impeding the development of physical literacy. Therefore, this study examined the relationship between functional movement and perceived and actual motor skill competence in young adolescents. Functional movement proficiency was determined using the Functional Movement Screen (FMS™), which provides three variables of interest: (a) FMS™ total score, (b) number of asymmetries, and (c) number of movement pattern dysfunctions. Perceived physical competence was assessed through the Children and Youth Physical Self-Perception Profile. Finally, the Get Skilled: Get Active process-oriented motor skill assessment was used to evaluate vertical jump, kick, run, and overhand throw proficiency. A significant positive correlation between FMS™ total score and vertical jump performance was found. A positive relationship was also found between the number of asymmetries and overhand throw performance. The Children and Youth Physical Self-Perception Profile constructs of body attractiveness and physical condition were positively associated with FMS™ total score, and physical condition was also shown to be inversely related to the number of movement pattern dysfunctions. Results suggest that functional movement may underpin movement competence and confidence.