We examine the importance of family background for early childhood development (ECD) using data collected in 2001 from 3,556 children ages 0-36 months in three regions of the Philippines. We focus on four main research questions: (1) are associations of family background with ECD in part proxying for health and ECD-related programs; (2) are associations of family background with ECD biased due to omission of unobserved community characteristics that may be related to placement of health and ECD-related services; (3) are there important interactions between family background and health and ECD-related programs in their effect on ECD; and (4) are there important interactions among the components of family background? Physical assets and human assets have a number of important positive associations with ECD. These include the positive relations between physical assets and the anthropometrics and hemoglobin levels of children, as well as lower occurrence of worms. Each parent's schooling and height also have notable positive effects on these outcomes and the motor and language skills of children. The failure to account for community characteristics is related to often substantial bias in the estimated effect of family background on ECD. We do not find strong evidence that interactions are important.