This song, written by Wayne Watson with the help of Paul Mills, is a reminder to parents to cherish their children while they're young, and before its too late. Watson explained in CCM Magazine presents 100 Greatest Songs In Christian Music that the inspiration for the song came when he was sitting at his kitchen counter and noticed a school painting by one of his sons, Adam, sticking to the door. He added: "It sort of looked like a pony, but there were elements and other things I couldn't identify. The house was cluttered with kid stuff; I thought of how soon the clutter would change to other stuff and then be gone altogether. It helped me take a deep breathe and appreciate the gift in front of me-children in care."
Watson said in CCM Magazine presents 100 Greatest Songs In Christian Music that prior to recording this, he'd been taking a few jazz guitar lessons and the song's distinctive opening chords are a direct result of those lessons. He added; "I've never really used them in any other songs. Even now, in concerts, audiences recognize 'Ponies' from the first chord."
This won the 1988 Dove Award for Pop Contemporary Song of the Year. The Watercolour Ponies set also won the award for Pop Contemporary Album of the Year.
When Watson re-recorded this for the acoustic retrospective album Signatures, the new version was produced by his oldest son, Neal.