This chapter considers normal developmental patterns in children's handling of conflict, their prosocial behaviour and moral understanding in early childhood, and in particular, some of the questions and challenges to developmental accounts raised by recent research on children's social understanding. The first section of the chapter summarizes the key developmental changes that have been described in children's angry and aggressive behaviour, in their behaviour in conflict, their prosocial behaviour and moral sensibility. The second section considers the relation of individual differences in these aspects of development to children's growing social understanding. Gender differences have been described in children's conflict strategies in group situations. It seems that sex differences in aggressive or prosocial behaviour are most consistently found in 'public' settings, within classrooms, playgrounds, neighbourhood gangs, rather than within intimate or family relationships.