Condemnation is ubiquitous in the social world and adults treat condemnation as a costly signal. We explore when children begin to treat condemnation as a signal by presenting 4- to 9-year-old children (N = 435) with stories involving a condemner of stealing and a noncondemner. Children were asked to predict who would be more likely to steal as well as who should be punished more harshly for stealing. In five studies, we found that 7- to 9-year-old children treat condemnation as a signal--thinking that a condemner is less likely to steal and should be punished more harshly if caught hypocritically stealing later. We discuss the implications of these results for children's emerging understanding of signaling and moral condemnation.