A number of research studies have utilised ‘working theories’, a key learning outcome of Te Whāriki, the Aotearoa New Zealand curriculum, as a lens to explore pedagogy in early childhood education. The perceived gap that this research sought to fill related to children’s working theories about fairness and diversity in the social world, alongside power/knowledge perspectives previously underexplored in existing working theories research literature. This Participatory Action Research study was located in a kindergarten community with 3- and 4-year old children in 2014. Using a theoretical framework informed by sociocultural and feminist poststructuralist perspectives, field texts composed from a mosaic of methods included a parent questionnaire and parent focus group, teacher discussions, observations, critical incidents and telling examples, and assessment documentation. Through critically and discursively reading and re-reading field texts, aspects of diversity that children were concerned with, including exclusion, the 'shadow side' of diversity, were identified. Children were making sense of their world(s), their identities, and the possibilities available to them, alongside negotiating relationships with diverse ‘others’. Their working theories, which related to fairness and friendship, gender, sex and sexuality, and ethnicity and skin colour, often involved normalising and limiting discourses. The subject of children’s working theories, and the perceived risks associated with them, affected teachers’ provocations and responses. The fundamental importance of teacher reflexivity and courage in this complex domain was uncovered. The conflicting and often uncontested framing of diversity and fairness by teachers and parents was highlighted. Teachers also have a leadership role to play, supporting parents who are unsure how to support their children’s developing understandings of diversity in the world around them. This research adds to the growing body of scholarship around ‘working theories’, recognising their value as a lens for seeing and responding to children’s ongoing theorising about aspects of diversity. The unique combination of working theories, power/knowledge perspectives, and dominant discourses offers new insights about critical pedagogy in this terrain. Diversity can be a rich resource for learning if teachers recognise how normalising and limiting discourses can affect children realising their potential. Opening up dialogue involves risks especially in areas that intersect with dominant views of childhood innocence or the irrelevance of some issues to young children. The importance of socially relevant curriculum that balances the interests of the child, and the interests of the community is stressed in an ‘Open letter to teachers’ which concludes this thesis. Making spaces for negotiation and meaning making, and valuing multiple perspectives and possibilities are part of renewed social justice, anti-bias teaching approaches. They are seen as part of the courageous whole setting response required to make the world a fairer, more just place for everyone.