Terence Kelly, 36, appeared via video link at Carnarvon Magistrates Court in Western Australia and pleaded guilty to the charge of “forcibly taking a child under 16.”
He is being held in a maximum security prison in the state capital, Perth.
Cleo Smith was found by police in a locked room at Kelly’s home in Carnarvon, just a few streets from where her family lived.
Her disappearance from a nearby campground on October 16 set off an 18-day search that gripped Australia as concern grew over her welfare.
Police said Cleo was found in a room in the house with the lights on, awake and playing with toys.
The case will now move to the District Court of Western Australia and a hearing will take place on March 25. A sentencing date has not yet been fixed.
Kelly faces two further charges including assaulting a police officer, to which he has not yet entered a plea.