Little is known about toddlers' acquisition of specific emotion regulation (ER) strategies, and how early ER is shaped by temperament. This study investigated if 24-month-old German toddlers, predominantly from families with high levels of parental education (N = 96, n = 49 male), learned the ER strategy distraction through observational learning, and its interaction with temperament. Increased use of distraction correlated with reduced negative affect. Use of distraction increased through observational learning. Highly active toddlers tended to use active playing activities to distract themselves in a frustrating situation, whereas toddlers with a less active temperament used calmer activities. Toddlers' learning to apply distraction through observational learning was independent of a match between their own temperament and the model's actions.