Physical activity (PA) is important for children’s growth and development and for their current and future health. Schools, especially during physical education (PE), are important locations for children to accrue PA. The purpose of this study was to assess the PA levels of preschool children during structured PE lessons and to evaluate the impact of selected characteristics (e.g., lesson context, length, and location; teacher behavior; class size; activity area density). Trained observers used SOFIT (System for Observing Fitness Instruction Time) to assess 90 structured PE lessons taught by 25 different teachers. Intact classes (n = 5 to 6 and representing 3 different grade levels) in 4 selected preschools were observed on 4 days over a 4-week period. Overall, children engaged in moderate-to-vigorous physical activity (MVPA) 49.9% (SD = 15.7) of lesson time and there were differences in MVPA% among the four preschools, by lesson context, and by teacher behavior. There were no significant differences in MVPA% either between indoor (n = 69) and outdoor (n = 21) lessons or among the 3 grade levels. Even though the lessons approached the 50% MVPA guideline, the brevity of them left children far short of recommended daily amounts of PA. Future studies should investigate how preschools can increase on-campus opportunities for PA both during PE and throughout the school days. Copyright © 2015 by authors and Scientific Research Publishing Inc.