Child overweight and obesity continues to be a global public health concern. The aim of this study was to investigate whether children's actual and perceived physical competence and parental perception's of their child's competence differ by weight status. Understanding these differences is important because physical activity levels are significantly lower among overweight children than their lean counterparts and children's motivation to participate in physical activity is influenced by their perceived and actual competence and their parents perceptions of their competence. Cross-sectional data were collected from 1414 9- and 11-year-old children and their parents from 20 primary schools in New South Wales, Australia. Outcomes measured included child and parental perceptions of physical competence and children's actual physical competence. Parents of overweight boys perceived them to be significantly less competent than parents of non-overweight boys. For 11-year-old girls, parent's perception of their daughter's ability to run (mean diff = 1.06 [95% CI 0.73, 1.40]), jump (mean diff = 0.54 [95% CI 0.15, 0.93]) and leap (mean diff = 0.78 [95% CI 0.41, 1.17]) was lower among parents of overweight children. Overweight children also reported lower perceived physical competence than non-overweight children. 9- and 11-year-old overweight boys had lower actual physical competence than non-overweight boys (mean diff = 1.32 [95% CI 0.29, 2.35]; mean diff = 1.26 [95% CI 0.37, 2.15], respectively). Overweight 11-year-old girls had lower actual competence than non-overweight 11-year-old girls (mean diff = 1.14 [95% CI 0.70, 2.12]). This study highlighted several differences between overweight and non-overweight children. Better understanding these differences at different stages of development may lead to identifying more specific and appropriate intervention points to promote physical activity in overweight children.