This study investigated the effects of persistent poverty on children’s development using the Longitudinal Study of Australian Children. The results showed that families in the persistently poor group were more likely to come from socially disadvantaged background that included young and unmarried mothers, less educated parents, Indigenous children, and children who speak other languages at home. Children in the persistently poor group showed significantly lower levels of socio-emotional and learning outcomes than children in the never poor group. The findings suggest that persistently poor families may need support to break the cycle of disadvantage. Actions to relieve poverty in early childhood and to reduce the effect of poverty are required to ensure adequate development of children in poverty in their early childhood.