As social beings, developing the capacity to communicate and interact with others, to acquire cultural knowledge, and to form relationships is essential for successful human growth. Central to these social- cognitive capabilities is the development of theory of mind - the understanding that the actions of self and others are attributable to internal mental states, such as beliefs, desires, intentions, and emotions. The importance of understanding mental states for social functioning is underscored in the case of autism; individuals with autism appear to have specific impairments in their understanding of mental states, which results in profound deficits in communication, social interactions, and forming relationships. To understand the neural substrates of such impairments, research must first investigate the neural substrates of how theory of mind typically develops. Although numerous functional neuroimaging studies have examined theory of mind in adults and older children, there are almost no data on the neural correlates of theory of mind in young children. Research has shown that core aspects of theory of mind develop during the preschool years. One consistent feature of theory of mind development is that children's understanding of desires precedes their understanding of beliefs. However, little is known about why there is this age lag in the development of belief reasoning versus desire reasoning. The specific aims of the proposed project are: (1) to determine the neural systems associated with belief reasoning versus desire reasoning, and (2) to investigate the development of these neural systems in relation to children's understanding of desires and their understanding of beliefs. Across several studies, neurophysiological data (i.e., electroencephalography (EEG) and event-related-potentials (ERP)) will be recorded as children perform tasks involving belief reasoning and tasks involving desire reasoning, as well as tasks involving reasoning about other mental states (knowledge, emotions). The project will provide insights into cognitive and neural underpinnings of the development of core social-cognitive abilities. Such insights will set the stage for greater understanding of the neural substrates of social-cognitive impairments in social and communicative disorders, such as autism.