Every year, 7% to 15% of preschool children are found to be underqualified for first grade. We examined whether sleep disturbances are factors in school readiness and their association with neurocognitive skills and behavior. The population included 148 kindergarten students. The study group consisted of 50 students who were assessed by the educational authority as unready for first grade. Children who were scheduled to attend first grade (n = 98) were in the control group. All children/parents filled in a sleep questionnaire and underwent a week of actigraphic sleep/wake study as well as cognitive and behavioral assessments. Children in the study group had significantly shorter total sleep time, reduced sleep efficiency, and increased number of nighttime awakenings. There were significant correlations between sleep variables, and cognitive and behavioral scores. In conclusion, children who fail to qualify for first grade have significantly inferior sleep patterns. Sleep disturbances were associated with cognitive and emotional immaturity.