Purpose: This study was aimed at determining the role of prosody and situational context in children's understanding of expressive utterances. Which one of these 2 cues will help children grasp the speaker's intention? Do children exhibit a "contextual bias" whereby they ignore prosody, such as the "lexical bias" found in other studies (M. Friend & J. Bryant, 2000)? Method: In the first experiment, a group of 5- to 9-year-old children and a group of adults performed a computerized judgment task. They had to determine the speaker's intention on the basis of an utterance produced with a particular prosody (positive or negative) in a particular situational context (positive or negative). In the second experiment, the same prosodic utterances were presented to 5- to 9-year-old children without a situational context. Results: The 5- and 7-year-old children relied primarily on situational context, in contrast to adults, who relied on prosody. The 9-year-olds relied on both cues (Experiment 1). When prosody was the sole cue (Experiment 2), all children relied on this cue to infer the speaker's intention. Conclusions: The results are discussed and integrated into a larger conceptual framework that includes research on lexical bias and sarcasm.