In the post-World War II era, there have been dramatic changes to the environment that appear to be having a detrimental impact on the lifestyles and incidental physical activities of young people. These changes are not trivial and have the potential to influence not only physical health, but also mental health and child development. However, the evidence of the impact of the built environment on physical activity to date is inconsistent. This review examines the evidence on the association between the built environment and walking for transport as well as physical activity generally, with a focus on methodological issues that may explain inconsistencies in the literature to date. It appears that many studies fail to measure behaviour-specific environmental correlates, and insufficient attention is being given to differences according to the age of study participants. Higher levels of out-of-school-hours physical activity and walking appear to be significantly associated with higher levels of urban density and neighbourhoods with mixed-use planning, especially for older children and adolescents. Proximate recreational facilities also appear to predict young people’s level of physical activity. However, there are inconsistencies in the literature involving studies with younger children. Independent mobility increases with age. For younger children, the impact of the built environment is influenced by the decision-making of parents as the gatekeepers of their behaviour. Cross-cultural differences may also be present and are worthy of greater exploration. As children develop and are given more independent mobility, it appears that the way neighbourhoods are designed — particularly in terms of proximity and connectivity to local destinations, including schools and shopping centres, and the presence of footpaths — becomes a determinant of whether children are able, and are permitted by their parents, to walk and use destinations locally. If older children and adolescents are to enjoy health and developmental benefits of independent mobility, a key priority must be in reducing exposure to traffic and in increasing surveillance on streets (i.e. ‘eyes-on-the-street’) through neighbourhood and building design, by encouraging others to walk locally, and by discouraging motor vehicle use in favour of walking and cycling. Parents need to be assured that the rights and safety of pedestrians (and cyclists) — particularly child pedestrians and cyclists — are paramount if we are to turn around our ‘child-free streets’, now so prevalent in contemporary Australian and US cities. There remains a need for more age- and sex-specific research using behaviour- and context-specific measures, with a view to building a more consistent evidence base to inform future environmental interventions.