Achieving a good level of development by five is considered to be a guide to future health prospects.
The Marmot Review team examined local authority data and found inequalities in life expectancy, how long people lived disability-free and unemployment.
The government said it wanted to improve the health of the vulnerable.
Regular bedtimesThe report's authors, who last year published a groundbreaking study of health inequalities in the UK, looked at five key indicators that are used to predict future health: life expectancy, disability-free life expectancy, child development at five, young people out of work and households on means-tested benefits.
The assessment of children's development at the age of five is based on their behaviour and understanding.
Children should be able to share, self-motivate, co-operate and concentrate by the time they start school.
But the research, led by British Medical Association president Sir Michael Marmot, found 44% of all five-year-olds in England are not considered by their teachers to have reached that level.
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