It has long been noted that verb phrase (VP) ellipsis cancels the polarity sensitivity of the English Positive Polarity Items (PPIs). In recent work, it has been proposed that words for disjunction are governed by a parameter. On one value of the parameter, disjunction is a PPI for adult speakers of many languages including Mandarin Chinese. On the other value, disjunction is interpreted "in situ." It has also been proposed that child language learners, across languages, initially interpret disjunction "in situ," not as a PPI. Taken together, these proposals predict that child and adult speakers of Mandarin will assign the same interpretation to disjunction in sentences with VP ellipsis, but will assign a different interpretation in sentences without VP ellipsis. This study assessed these predictions. In sentences with a full VP, the adult participants analyzed disjunction as a PPI, but they interpreted disjunction "in situ" in sentences with VP ellipsis. The child participants interpreted disjunction "in situ" in sentences of both kinds. Together, the findings support the recent proposal that disjunction is governed by a lexical parameter, with a default setting.