This undergraduate thesis paper deals with the topic of language development of preschool children and the possibilities of encouraging it through using literary texts, that is fairy tales. The thesis paper defines a child's speech and language development, describes its chronological course from the preverbal phase with the initial cry to the verbal stage after the arrival of the first meaningful word. The paper also considers the importance of speech and language development and looks at mother tongue acquisition. The thesis paper starts with the definition of language and speech, clarification of speech-language development, and verbal and non-verbal communication. Also, the thesis paper touches on the importance of motivating and encouraging speech-language development for complete speech, cognitive, emotional, and cognitive development of young children. Early childhood and its orderly course are decisive factors in the overall development of children, as well as, language development, and the complex process of development which begins in the prenatal period. A quality home environment and a supportive family, institutional childhood, and competent educators are critical factors in a child's language and speech development, given that this process is most dynamic in the first three years of a child's life. Also, the paper touches on the crucial issue of the need to encourage language development through the use of literary texts intended for early and preschool age. According to many of its features, a fairy tale is the most suitable literary and artistic form to use while working with children. Therefore, individual elements of the fairy tale, types of fairy tales, and the importance of fairy tales for children's cognitive and language development are analyzed. Also, there has been an evaluation of the ability of a fairy tale to improve the child's language expression. It is concluded that the stimulating environment is crucial for the child's overall development, including language and speech. The fairy tale can also play a valuable role in this. By reading fairy tales and retelling the stories, the language development in children of early and preschool age can indeed be reinforced and improved.