"A number of children" have been identified as potential victims by police investigating claims of a sexual assault at a nursery.
Officers were called to Jack and Jill Childcare, in Torquay, in July.
Devon and Cornwall Police said it had since identified several children as "potential victims of contact offences".
An employee, who was arrested and bailed in July, has been moved out of the area while inquiries continue.
The nursery, which caters for children as young as two, has had its licence suspended.
Acting Det Ch Insp James Stock, of Devon and Cornwall Police's Public Protection Unit, said more than 250 hours of CCTV at the nursery had been reviewed.
He said "a number of children aged two-plus have been identified as potential victims of contact offences" as a result.
More than 100 families who have children at the nursery have been contacted as part of the investigation, police said.
Officers and social workers had visited parents and guardians of those believed to be victims.
In a notice posted on a window at the nursery, Ofsted said the suspension runs from 24 October to 24 December.
"The purpose of the suspension is to allow time to investigate our belief that a child may be exposed to a risk of harm and for any necessary steps to be taken to eliminate or reduce the risk of harm," the notice said.
"We will regularly review the situation and will stop the suspension within this period if we believe children are no longer at risk.
"Suspension does not automatically mean that a provider is unsuitable to provide care in the future or that we will cancel registration.
"We only take steps to cancel registration if we consider that the provider is no longer suitable to provide childcare."
Acting Det Ch Insp Stock said contact with the suspect appeared to be "limited to within the nursery setting and we do not believe that any other member of staff had knowledge of these matters".
"These appear to be the actions of a lone individual. and the offences do not involve the taking or distributing of any images," he said.
Nancy Meehan, deputy director of Torbay Children's Services, said safeguarding children was taken "incredibly seriously" and a helpline had been set up for anyone who had concerns.