Objective: To investigate at a population level whether England’s universal assessment of ‘school readiness’ is associated with later identification of special educational needs (SEN). Also, whether ethnic differences exist in SEN identification (white British versus ethnic minority) and whether this varies as a function of school readiness. Method: Analysis included 53 229 individuals aged 5–12 years from the Connected Bradford Database (2012/2013–2019/2020). Logistic regression analyses examined: (1) whether reaching a ‘good level of development’ on England’s ‘school readiness’ assessment was associated with later SEN identification; and (2) whether interactions exist between school readiness and ethnicity. Results: 32 515 of 53 229 children reached a good level of development, of which 3036 (9.3%) were identified as having SEN. In contrast, 10 171 of 20 714 (49.1%) of children who did not reach a good level of development were later identified as having SEN. Children not reaching a good level of development had increased odds of being later identified as having SEN after controlling for covariates (OR: 8.50, 95% CI: 8.10 to 8.91). In children who did not reach a good level of development, white British children had higher odds of being identified as having SEN compared with ethnic minority peers (OR: 1.22, 95% CI: 1.11 to 1.34). No ethnic differences of having SEN were observed in children reaching a good level of development (OR: 1.04, 95% CI: 0.93 to 1.16). Conclusions: School readiness assessments are associated with later SEN identification. Structural inequalities may exist in SEN identification in children not entering formal education ‘school ready’. Such assessments could facilitate earlier identification of SEN and reduce structural inequalities in its identification.