The construction of gender identity is a complex process which begins at a very early formative age. In the formative years, children begin making sense of how men and women are positioned in society. As important institutions, schools play an important role in this process, particularly with reference to students’ understanding of gender relationship around them. The present study explored how gender identity construction takes place in single sex classroom for early years. Qualitative research guided the study design which was conducted in two public sector’s single sex schools (one for girls and one for boys) in Karachi, Pakistan. The data were collected through observations of the teacher-student interactions, student-student interactions, focused group discussion with children from both the schools and semi-structured interviews with the teachers (male and female teacher). The study found that the teaching and learning is gendered in single sex settings of a school, as gender messages are passed on to the students which play an important role in the gender identity construction of these children. The study indicated that the teachers’ personal experiences greatly influence their perceptions regarding gender identities. There was also evidence that teachers have different expectations from girls and boys. Another important finding highlighted that children brought certain perceptions from home which contributed to the gender discourse in the context of the school. These children believed that they were different from each other because of being boys or girls and that they had different roles and responsibilities. Schools were, hence, found promoting those stereotypes regarding gender roles and responsibilities in a social context. All the participants were found to have views and practices around gender positioning which was approved by the larger society. The findings of the study emphasise the importance of gender awareness among the teachers in order to provide an equitable learning environment to the students. The research has significance for teachers, teacher educators and school management who wish to promote gender sensitive teaching and learning spaces in early years’ education.