Our study evaluates the moral reasoning skills of healthy and chronically ill 3 and 4 year olds with respect to illness and treatment, by use of an interview technique that reduces verbal demands on the child, We presented children with pairs of scenarios comparing ill characters with characters acting immorally and characters being punished, as well as with pairs of scenarios comparing treated characters with characters acting immorally and characters being punished. We asked children to point to the character who did something "naughty." With the exception of the chronically ill 3 year olds, the children performed consistently above chance and did not confuse illness and immorality. Older and healthy children performed better than younger and chronically ill ones (differences were the result of differing receptive vocabulary skill levels). This research has implications for evaluating young children's reasoning abilities and suggests that medical professionals should use tools that reduce demands on children's verbal proficiency. J Dev Behav Pediatr 19:68-76, 1998. Index terms: cognitive development, health education, illness concepts, moral development, treatment concepts.