Based upon the belief that what children learn from adult responses to their early behavior sets the foundations on which they will build all future learning, this publication provides information for teachers on the appropriate guidance and management of children's behavior in early childhood settings using a contextual approach. Issues discussed in the document include: (1) setting a behavior policy for the institution; (2) building positive relationships with children; (3) using a knowledge of child development to create appropriate expectations for behavior; (4) considering developmental issues in responding to children's behavior; (5) understanding the impact of changes and loss on children's behavior; (6) examining the variety of family lifestyle issues, such as family routines, living situations, and family tensions; (7) identifying the effects of sociocultural backgrounds on children's behavior, including Aboriginal and Torres Strait Island children; (8) understanding the personal characteristics of each child; (9) realizing the impact of various chronic or acute illness on children's behavior; (10) dealing with children's aggression; (11) creating behavior-friendly classroom environments; (12) developing a plan when behavior problems arise; (13) working with parents; (14) responding to particular behavior problems, such as out of control feelings, emotional stress, regression, and separation anxiety; (15) talking to a child when there is a problem; and (16) using a checklist to identify and evaluate possible strategies for guiding children's behavior. A list of resources concludes the publication. (KDFB)