Data from the National Institute of Child Health and Human Development Study of Early Child Care were analyzed to explore effects of marital separation on children in the first 3 years of life. The sample included 73 never-married mothers and 97 separated mothers; a comparison group of 170 was conditionally randomly selected from the 2-parent families. Children in 2-parent families performed better than children in 1-parent families on assessments of cognitive and social abilities, problem behavior, attachment security, and behavior with mother. However, controlling for mothers' education and family income reduced these differences, and associations with separated-intact marital status were nonsignificant (the effect size was .01). Thus, children's psychological development was not affected by parental separation per se; it was related to mothers' income, education, ethnicity, child-rearing beliefs, depressive symptoms, and behavior.