Purpose: Early childhood caries (ECC) may have a harmful impact on quality of life (QoL) of young children and parents. No oral health-related quality of life (OHRQoL) studies had been carried out among preschool children in Jordan. The aims of the study were to assess the prevalence of ECC among preschool children and to evaluate its impact on the QoL of children and families. Materials and Methods: A cross-sectional survey was conducted among preschool children aged 4 and 5 years. A two-stage random sampling design was implemented. Parents answered the Early Childhood Oral Health Impact Scale (ECOHIS) which was used to assess OHRQoL and a questionnaire addressing sociodemographic data. Clinical examination included ECC, anterior malocclusion treats (AMT) and traumatic dental injuries (TDIs). The simultaneous influence of different independent variables including gender, AMT, TDI and socioeconomic indicators (SEI) on the overall QoL was also investigated. Analysis of variance test (ANOVA), the Fisher's least statistically significant difference criteria of post hoc and simple logistic regression were used for statistical analysis. Results: Of the 2164 targeted preschool children, 1557 were included in the study. Prevalence of ECC was 72.5% and 77.2% among 4 and 5 year olds, respectively. Compared with caries-free children, ECC children (dmft 1–4 and dmft >4) had significantly higher mean scores of all the items of the ECOHIS (p < 0.05, 0.01 and 0.001) as well as mean scores of overall ECOHIS (p < 0.001). There was a significant increase in mean scores of items (p < 0.05, 0.01) and overall ECOHIS mean scores (p < 0.05) with increasing severity of dental caries. Only dental caries had a significant effect on ECOHIS (OR = 4, CI 3.179–5.972, p < 0.001) while other confounders failed to demonstrate any impact. Conclusions: Dental caries prevalence was high and the level of severity was associated with worse OHRQoL of preschool children and families.