The change is the first made under new laws that allow ministers to declare areas smoke-free without legislation. Assistant Health Minister Meegan Fitzharris said it was a logical move.
"We think most people know that smoking around a playground is not the right thing to do, and that smoking is not good for your health and it's certainly not good for children's health."
There has been strong community support for the ban, with 98 percent of 307 submissions made during the consultation period in favour of the change.
"We want to ensure our playgrounds and playspaces are vibrant, healthy places for families to be in, and that they help foster in our kids healthy social, physical and mental development," Ms Fitzharris said.
"Second-hand smoke can be particularly harmful to children because their lungs are still developing. They have a higher risk of health conditions such as middle ear infections, asthma ... which can be exacerbated by exposure to second-hand smoke."
Ms Fitzharris said more smoke-free declarations would come in the next term of government, including public spaces such as bus interchanges and light rail stops.
"Smoking rates continue to decline but we can't take our eye off the ball," she said, adding "We have to make sure that people understand the dangers of smoking and the health risks — not just to them but to the broader community."
'No smoking' signs will now be installed at ACT public playgrounds and play spaces, and those caught smoking in a declared smoke-free area will face fines.