Children aged 3 years and 4 1/2 years old watched a puppet, struggling to achieve goals, who was helped by a 2nd puppet and violently hindered by a 3rd. The children then distributed wooden biscuits between the helper and hinderer. In Experiment 1, when distributing a small odd number of biscuits, 4 1/2-year-olds (N = 16) almost always gave more to the helper. Children verbally justified their unequal distributions by reference to the helper's prosocial behavior or the hinderer's antisocial behavior. In Experiment 2, when biscuits were more plentiful, 4 1/2-year-olds (N = 16) usually gave equal numbers to helper and hinderer, indicating that 4 1/2-year-olds usually preferred not to distribute unequally unless forced to by resource scarcity. Three-year-olds (N = 16 in Experiment 1, N = 20 in Experiment 3) gave more biscuits equally often to the helper and to the hinderer. In many cases, this was because they were confused as to the identities and actions of the puppets, possibly because they were shocked by the hinderer's actions. Two fundamental moral behaviors are therefore demonstrated in young preschoolers: indirect reciprocity of morally valenced acts and a preference for equality when distributing resources, although the cognitive bases for these behaviors remain unclear. These results join other recent studies in demonstrating that the seeds of complex moral understanding and behavior are found early in development. (Contains 2 tables, 2 figures and 2 footnotes.)