Introduction: Atopic dermatitis (AD) is a chronic inflammatory disease that begins in early childhood. Sleep problems have increased in children with AD. The aim of this study was to evaluate sleep patterns and the development of children with AD at an early age. Methods: This is a cross-sectional study consisting of a total of 80 children aged 0–36 months with AD. Patients were evaluated by the Brief Infant Sleep Questionnaire and International Guide for Monitoring Child Development. Results: The median age (IQR) of the patients was 6 (4.25–9) months, 63.7% of them were male and 50% of them had sleep problems. Male sex (OR: 3.78, p = 0.024, 95% CI, 0.083–0.837), patients with AD who were in the first 3 months after diagnosis (OR: 3.56; 95% CI, 1.220–10.43, p = 0.020), and moderate-severe AD (OR: 5.09; 95% CI, 1.649–15.748, p = 0.005) were determined as risk factors for sleep problems. In all, 12.5% of the patients needed support for one or more developmental areas (gross motor skills, expressive language and communication, receptive language, fine motor skills, relationship, and play). Developmental delay was higher in patients with sleep problems (p = 0.037). Multiple siblings (OR: 14.381; 95% CI, 1.557–132.871, p = 0.019) and the presence of sleep problems (OR: 8.011; 95% CI, 1.764–36.387, p = 0.024) were found to be risk factors for developmental delay. Conclusion: Boys with moderate-severe AD within the first 3 months of diagnosis were at increased risk for sleep problems. Children with AD who have multiple siblings and sleep problems should be evaluated for developmental delay and monitored closely.