This study explored educators' perspectives on the role the physical and sensory Early Childhood Education and Care (ECEC) environment plays in supporting children's social and emotional development. Ten semi-structured interviews were conducted, in August 2022, at two ECEC sites in Victoria, Australia. Data were thematically analysed and key findings suggest children engage and interact with their environment to facilitate opportunities for social interactions and emotional regulation. Environmental stimuli can have a positive and negative influence on children's social and emotional competence. Educators reported lack of resources, building design, and limited staffing were barriers to using the environment. Reflective practice, collaboration within teams and services, and access to resources strengthened the use of the environment in everyday practice. Optimal environments rely on educator reflections and responsivity to adapt the environment to the needs of the children utilising the space.