The present study investigated emotion management skills (i.e., emotion decoding, emotional understanding) in externalizing and nonexternalizing children. Eighteen externalizing children, 18 control children, and their mothers were recruited for participation from community programs, including the Head Start Program and YMCA. Children were administered questionnaires designed to measure emotion management skills. Mothers completed a measure assessing childrens level of externalizing symptomatology. Findings indicated that externalizing children demonstrated similar levels of emotional understanding and emotion decoding skills. Further, externalizing children did not demonstrate a bias for expressions of anger when decoding expressions of sadness and fear. Findings suggest the importance of observational research that places children in real- life situations given that externalizing children tend to show deficits in emotion management in interpersonal settings.