Play-based learning (PBL) is widely recognized as a foundational approach in early childhood education, supporting children’s cognitive, social, emotional, and creative development. India’s National Education Policy (NEP) 2020 reinforces this approach by embedding experiential learning within Early Childhood Care and Education (ECCE). This systematic review examines the effectiveness of PBL interventions in enhancing the cognitive abilities of preschool children, in alignment with NEP 2020. The review synthesized national and international literature published between 2000 and 2025, drawing from peer-reviewed studies, review articles, policy documents, and practice-oriented reports accessed through Google Scholar, and recognized Indian education platforms. Studies were selected using predefined inclusion criteria and analyzed thematically based on intervention type and cognitive domains. Findings indicate that play significantly enhances cognitive functioning and promotes emotional regulation and social competence. The review highlights the importance of culturally responsive play-based practices and identifies implementation challenges, offering policy and practice recommendations.