This research project investigated, in two stages, the ways in which playground equipment and the addition of loose parts to a playground contribute to preschool children’s dramatic and constructive play behaviors. In the first study, for ten months we observed children attending a lab preschool as they played on large, multi-station outdoor play structures in order to identify design features of outdoor play equipment that encourage particular play behaviors and social interaction. The design features that encouraged fantasy play were enclosed spaces with visibility to other areas of the playground, nodes and connector spaces, and stage-type spaces. Boys engaged in more functional play while girls engaged in more fantasy play. The second study, conducted with the same lab preschool but different children, tested the effects of a design intervention on the playground. We added loose parts suitable for constructing spaces to the playground and we observed children’s play behavior before, during and after the intervention. Constructive play behavior increased in the areas of the playground to which we had added the loose parts. Children used the places they constructed for dramatic play activities. The second study confirmed findings from the first study that young children like to act out dramatic play themes in small, enclosed spaces. In the second study, children were able to construct their own spaces, which not only encouraged dramatic play but also communication and negotiation skills.