Purpose: To evaluate child-adult differences for consonant identification in a noise or a 2-talker masker. Error patterns were compared across age and masker type to test the hypothesis that errors with the noise masker reflect limitations in the peripheral encoding of speech, whereas errors with the 2-talker masker reflect target-masker confusions within the central auditory system. Method: A repeated-measures design compared the performance of children (5-13 years) and adults in continuous speech-shaped noise or a 2-talker masker. Consonants were identified from a closed set of 12 using a picture-pointing response. Results: In speech-shaped noise, children under age 10 years performed more poorly than adults, but performance was adultlike for 11- to 13-year-olds. In the 2-talker masker, significant child-adult differences were observed in even the oldest group of children. Systematic clusters of consonant errors were observed for children in the noise masker and for adults in both maskers, but not for children in the 2-talker masker. Conclusions: These results suggest a more prolonged time course of development for consonant identification in a 2-talker masker than in a noise masker. Differences in error patterns between the maskers support the hypothesis that errors with the 2-talker masker reflect failures of sound segregation. (Contains 5 figures, 1 footnote, and 1 table.)