In cooperative activities, all parties have a shared goalbut may not have the same set of skills. The currentstudy considers whether preschoolers are sensitive toprobable differences in individuals’ competence whenallocating roles. We found that 3.5- to 5.5-year-olds userelative competence, as indexed by the age of theirintended partner, to determine who should do the harderand easier of two tasks in a cooperative interaction. Asecond experiment demonstrated that children allocateroles differently in a competitive context. Youngchildren infer differences in others’ ability and candivide labor efficiently to achieve their goals.