Although teacher underestimation of ability can have a detrimental effect on children's achievement and motivation, the accuracy of Australian teachers in identifying intellectual giftedness in young children has not been investigated. This study followed 14 children, identified as potentially gifted while preschoolers, for up to 3 of their early years of school, collecting questionnaire data from 26 teachers and the parents, as well as interview and norm-referenced test data from the children. Teachers rated more highly the children whose test scores were more consistently in the gifted range, but more than half of the children were underestimated by at least 1 teacher, especially where nonverbal ability was higher than verbal ability. Strengths in reading were more readily recognized than strengths in spelling and mathematics. Child attitudes and behaviors, as well as some mutual parent-teacher distrust, may have contributed to teacher underestimation. Implications for practice and further research are discussed. (Contains 3 tables.)