An experiment was carried out to examine developmental changes in children's ethnic preferences and social cognitions to assess predictions drawn from sociocognitive theory and social identity theory. Two hundred and seventy Anglo-Australian children participated, with equal numbers of 8-, 10-, and 12-year-old children being drawn from one of three types of school that differed in its level of ethnic mix. The children listened to a story about an in-group Anglo-Australian boy and an out-group Vietnamese boy, each of whom displayed equal numbers of ethnic stereotype-consistent and stereotype-inconsistent traits. Each story character also displayed a positive and a negative behaviour. The results revealed that, as they increased in age, the children remembered more of the in-group versus out-group story character's stereotype-inconsistent versus stereotype-consistent traits and that they increasingly disliked the in-group story character, whereas they liked the out-group story character. In addition, the in-group and out-group story characters' negative behaviours were attributed to internal and external causes, respectively, whereas their positive behaviours were attributed to external and internal causes, respectively. The greater support for social identity versus sociocognitive theory revealed by these findings is discussed.