The smiles and laughter of an infant form the beginning of the developmental process of interpersonal interaction and socialization. The earliest smiles are automatic expressions of internal states, but soon infants' smiles are communications of pleasure. The developmental changes in smiling and laughing in early infancy reflect the rapidity with which these emotional responses become important elements in the interactions between the infant and his social environment. The importance of smiling and laughter is demonstrated by clinical observations of their absence; distressed or frightened infants do not smile or laugh. Recent investigations point to humor as an essential component of the normal growth process. Humor provides the individual with the opportunity to re-experience the gratifications of cognitive and interpersonal mastery. An important determinant of children's humor responses is the degree to which the humor requires them to use their cognitive abilities maximally. Humor is conceptualized here as a reassertion of one's competence and its antithesis, anxiety, as a painful state of helplessness. Humor is frequently used to dispell anxiety; by secondary reinforcement humor becomes a learned motive to experience mastery in the face of anxiety--the "whistling in the dark" phenomenon. Humor development parallels the stages of cognitive and psychosocial development. Humor is used to circumvent prohibitions, express aggression indirectly, and can be used to facilitate learning. (KM)