The relationship between social skills, social interaction, and popularity was examined. The subjects were 198 children in third and fourth grades in middle- and low-income schools. The relationships between number of friends, socioeconomic status, and grade level were studied in a 2 times 2 times 2 factorial design with 2 sets of dependent measures: (1) social skills were assessed by an experimenter testing each child individually on a set of tasks which included measures of the ability to label emotions in facial expressions, knowledge of how to make friends, giving help, and role-taking ability; and (2) social interaction in the classroom was assessed using a naturalistic observational system. Popular and unpopular children differed in their knowledge of how to make friends and on the referential-communication task. In the classroom, popular children distributed and received more positive reinforcement than unpopular children and spent less time daydreaming. Both grade and social class factors were significant. However, different patterns of results contributed to the main effect of friends and the grade-level main effect. The importance of assessing social skills which are first validated by reference to a criterion such as sociometric position was noted.