The increased attention given to immigrants’ English proficiency and their academic achievement in schools has blinded society to the issues associated with heritage language (HL) loss that children of immigrants face. Using qualitative methods, this study investigated how family language policy (FLP) was developed and enacted in the context of 14 Chinese and Korean American families with attention to the interactive effect between multiple layers of environment of the family on the child’s HL development. The main questions of this study are what language ideology or beliefs parents hold up; how their language ideology or beliefs are manifested in their language planning and practice regarding HL maintenance for their children; what contextual factors account for HL maintenance and loss. In line with past studies, the present study supports the notion that the parent is one of the most significant factors in early bilingual development and HL development in young children. Parental involvement was broad from home language and literacy practice, the form and type of HL education after school, to the engagement of a community of practice. Findings also highlight that FLP was mediated by (1) parents’ language ideologies or beliefs concerning bilingual development and HL maintenance, (2) parents’ perceived competence in the HL and their expectation about HL literacy of their children, (3) Parents’ familial and economic resources. Further, the parents in the study revealed the multiple layers of parental language belief: language as connection, language as culture, language as capital. That is, they believed that learning the HL would enable their children to stay connected with family members; maintain ancestral links; foster positive attitudes towards their culture; promote career competitiveness for children. One of the key findings was that parental factors did not act independently in the process of children’s HL development. In contrast with past studies, this study found various important agents (i.e., parents, family members, HL teachers, ethnic peers) who engaged in and mediated children’s HL development. In particular, I emphasize the agentive parents who create FLP. I found that the parents in the study formed FLP and continued to modify it, acting for or against American linguistic culture in concert with resources they had and circumstances they faced. FLP, therefore, was mediated by a combination of parents’ life stories, their own circumstances, and their interpretation of American linguistic culture. In this sense, FLP is fluid and dynamic, not static. That is, it changes over time. The study indicates that parental perception of the economic and social value of their heritage language and literacy determines the degree of parental commitment to maintain the HL for their children. More importantly, the study found that young children were not a passive by-stander, but acted as agens. Their attitudes toward HL learning mediated parental decisions making regarding family language practice. Children’s attitudes were greatly influenced by their learning experiences in HL schools. Based on findings from the study, I argue that the meso levels of FLP matters in early bilingual development. Findings underscore the fluidity and complexity of FLP which is mediated by multiple dimensions of surroundings environments of the family. Such findings have implication for school teachers, HL teachers, and policy makers who directly influence the lives of children in immigrant families.