Parents are increasingly happy with the childcare in their area, but more than one in five are still struggling with the cost, according to a survey.
Around eight in 10 families with children aged 14 and under - equivalent to around 6.3 million youngsters - used some form of childcare, from nurseries to after-school clubs and help from relatives, during a term-time week in 2014/15, the government-commissioned report found.
But the findings, based on a poll of mothers and fathers, also revealed that children from richer backgrounds were still much more likely to receive some form of formal childcare than those from poorer homes - and this gap had not narrowed in the last two years.
Overall, around two-thirds of youngsters from wealthier homes (65%) were in formal childcare, compared to half (49%) of those living in the most deprived areas.
Nearly two in three (64%) of the parents surveyed rated the quality of childcare in their area as very or fairly good, up from 58% who said the same in 2012/13.
Just under half (46%) thought the number of places available was "about right", with 28% saying there were not enough.
And while just over half (53%) said it was fairly, or very easy to meet their childcare costs, a significant proportion - 22% - admitted finding it fairly or very difficult to find the money. This had dropped from 27% two years ago.
The survey also revealed that 47% of families with children of school age (five to 14) used childcare during the school holidays.
Around 62% of parents who worked during these breaks said it was fairly or very easy to arrange care, while 21% found it difficult.
The findings come amid government plans to double free early years education for three and four-year-olds from 15 hours to 30 hours in 2017.
Purnima Tanuku, chief executive of the National Day Nurseries Association (NDNA) said: "It's good news that parents feel that the quality of childcare is rising.
"NDNA and the sector work hard continually to achieve higher standards.
"But it is concerning that 22% of families are struggling to pay fees.
"The biggest single reason for rising nursery fees is the chronic underfunding of free places which could result in more losses for childcare providers when the Government's 30 free hours for three and four-year-olds of working families is introduced next year."
Childcare minister Sam Gyimah said: "This survey shows that the vast majority of parents who want childcare are taking up our free childcare offer.
"We are going further to support hardworking parents by extending this to 30 hours a week for three and four-year-olds, backed by a record investment of £6 billion a year by 2020."
:: The survey, which runs every two years, questioned 6,198 parents in England between October 2014 and July 2015.
Neil Leitch, chief executive of the Pre-school Learning Alliance, said: "With nine in 10 parents of three and four-year-olds in receipt of government funded early education, the report affirms the integral part that early years plays in the UK's social, economic and cultural fabric.
"However, it raises a number of concerns not least that the use of free entitlement rose by income; only 80% of families earning below £10,000 per year are receiving it, compared to 94% of families earning £45,000 or more. Additionally, only 54% of eligible two-year-olds are in receipt of government funded early education.
"This raises questions about why this take-up is not higher, and suggests that providers in areas of deprivation are struggling to meet the needs of parents because they simply cannot afford to. Indeed, the report highlights that usage of formal childcare fell as area deprivation levels rose."