Nurseries and childminders in England that require improvement will have just two years to achieve an Ofsted "good" rating, the watchdog says.
From November the current "satisfactory" judgement will be replaced by "requires improvement" for early years providers
Any that do not "get to good" in the time frame will face the prospect of being judged "inadequate", Ofsted says.
The Pre-school Learning Alliance voiced "serious concerns" about the plan.
Ofsted chief inspector Sir Michael Wilshaw said: "The early years are crucial. That's why only a good standard of education and care is acceptable for our youngest children."
The new system will bring the inspection judgements for early years providers into line with schools and colleges, with four inspection levels: "outstanding", "good", "requires improvement" and "inadequate".
The move follows a consultation this year, the results of which are published to coincide with the announcement.
The report, Good Early Years Provision For All, summarises the outcomes of the consultation, which received more than 2,500 responses from childcare professionals, parents and carers.
Ofsted says the consultation revealed that the "overwhelmingly strong opinion" of parents and carers was that two years was too long to wait for improvements in education provision for very young children.
"Two years is a long time in a child's life and it's long enough for a setting to improve," said Sir Michael.
"I agree with the parents who told us in our consultation that four years is too long to wait for a nursery to reach the good standard that every child deserves."
Ofsted figures for last year showed that the majority of England's nurseries and childminders were judged "good" (62%) or "outstanding" (12%) by inspectors - but 25% were judged "satisfactory", and 1% classed as "inadequate".
Sir Michael said some providers were not improving fast enough between inspections, particularly in poorer areas.
"Too many pre-schools and nurseries across the country are not yet good, particularly in the most deprived areas."
Neil Leitch, chief executive of the Pre-school Learning Alliance, said: "The sector is growing more concerned by the day about the unfairness of Ofsted inspections, with an increasing number of childcare providers having their rating downgraded.
"Unless Ofsted acts to sort this out, what is intended to move the sector towards higher standards could end up being unfairly detrimental to some settings."
Mr Leitch added that Ofsted's focus on areas of deprivation risked "the devastation of childcare services in these areas, where they are needed most", which could be "catastrophic".
Purnima Tanuku, of the National Day Nurseries Association, said inspections needed to be more "robust, consistent and accurate" to gain providers' confidence.
Ms Tanuku added that the changes would mean that the "good" category would become "very broad... making the need for transparency on the way judgements are made absolutely vital".
Jill Rutter, of the Family and Childcare Trust, said that Ofsted had failed "to clarify how early years providers that are graded as 'inadequate' or 'requiring improvement' will be helped to improve.
"Neither Ofsted nor local authorities presently have the resources to deliver the intensive mentoring that many of these providers need."
The watchdog says it will publish a new inspection framework for early years providers in September and the first inspections under the new system will start in November.