Mark the area to be leveled. Do this by putting down small stakes on the ground or spray painting (using ground-marking spray paint) the perimeter.
Dig up any grass currently growing on the designated area, as well as any bushes growing there or pebbles and stones. If removing sod or bushes, make sure you dig up all the roots so the plant material does not regrow. Dispose of anything you dig up.
Put down a thin level of pea gravel or crushed stone if the area lacks adequate drainage. This will ensure that rainwater doesn’t flood the site, turning the play area into a giant puddle. Compact the gravel or crushed stone, making sure the surface is as level as possible.
Add a layer of soil-and-sand mixture. This mix should be equal parts dry topsoil and sand. Compact it so the surface is as firm as possible. Do this by tamping the soil down with your shovel, placing bricks on top of it or going over it with a heavy garden roller.
Determine where the soil is not level, using a carpenter's level. Shovel away lumps and re-compact the soil in those spots. Add soil to sagging areas and re-compact those areas.
Lay down mulch, sand or synthetic rubber material. Once this is down, the area is ready for a play set.