Psychological essentialism is one of the primary ways children attempt to make sense of the world around them, positing categories for everything from biological phenomena to socially constructed status and including gender, ethnicity, and race. Different predictions about child development are made by theories of essentialism, compared to the traditional social-cognitive and socialization theories. Within social-cognitive theories, children were traditionally thought to be able to conceive of race only when they could explicitly differentiate racial categories. It is important to differentiate psychological essentialism, which involves a cognitive or psychological bias, from sociological essentialism in which the bias reflects sociological processes. This chapter charts the progression of psychological essentialism in early childhood to sociological essentialism in late childhood and adolescence. Recent research on infancy has challenged the traditional focus of developmental theories on explicitly articulated notions of race. This research finds that young infants begin processing race long before they are able to make explicit references.