A survey conducted by the Pre-school Learning Alliance found that 57 per cent of early years practitioners say they have suffered from anxiety as a result of work, while 26 per cent have experienced depression.
Meanwhile, 65 per cent say work-related stress or mental health difficulties have impacted on their personal relationships, while 45 per cent said their work performance has been negatively affected.
In addition to one in four practitioners thinking about leaving the sector, five per cent of those questioned confirmed that they will be leaving the sector or have already left.
Neil Leitch, chief executive of the Pre-school Learning Alliance, said the survey findings highlight the impact that "excessive workloads and severe financial pressures" are having on the mental health of the early years workforce in England.
"It's clear from these results that years of ill-thought-out policies, inadequate funding and ever-increasing demands on the sector have taken their toll, and it is frankly shameful that we have reached this point.
"While over recent years, there has been at least some focus on the workload concerns of the primary and secondary education sectors, the struggles of those working in the early years have been largely ignored - and this is the result.
"When you get to a situation where a quarter of your workforce is actively considering quitting, it's clear something needs to change."
The Pre-school Learning Alliance is calling on the Department of Education (DfE) to tackle the situation by addressing the funding concerns.
The DfE has been contacted for comment.