According to the American Academy of Pediatric Dentistry, one of the common causes of toddler tooth decay is letting a toddler go to bed with a bottle. This particular condition is known as baby bottle tooth decay. The milk or juice from the bottle can sit in your toddler’s mouth all night and create an ideal breeding ground for bacteria which in turn causes tooth decay. Also unhealthy eating habits contribute to tooth decay, too. Allowing your child to suck on candy for prolonged periods or to eat a lot of sugary foods will play a role.