This is the fourth Active Healthy Kids (AHK) Wales Report Card. The 2021 card produced grades on children and young people’s physical activity (PA) using pre-COVID-19 data that were not used in previous versions. Eleven quality indicators of PA were graded through expert consensus and synthesis of the best available evidence. Grades were assigned as follows: Overall PA—F; Organised Sport and PA—C; Active Play—C+; Active Transportation—C−; Sedentary Behaviours—F; Physical Fitness—C−; Family and Peer Influences—D+; School—B−; Community and the Built Environment—C; National Government and Policy—C; and Physical Literacy—C−. All but three grades remained the same or decreased from the 2018 AHK-Wales Report Card (Active Play increased from C− to C+; Active Transportation, D+ to C−; Family and Peers, D to D+). This is concerning for children’s health and well-being in Wales, particularly given recent evidence that PA has further decreased during the COVID-19 pandemic. The results from the Report Card should be used to inform the decision making of policy makers, practitioners and educators to improve children and young people’s PA levels and opportunities and decrease PA inequalities.