The major purpose of this study was to develop a reliable observation instrument to code parent-caregiver communication as it occurs when children are dropped off and picked up at day care centers. The Parent-Caregiver Communication Checklist (PCCC) was designed as an observation tool to assess informal communication between parents and caregivers or directors in day care centers. The instrument contains content and structural components, with the latter assessing frequency, duration, and responsibility in communication. Other features of the PCCC include ratings of setting and tone of communication, a coding manual, and an observer training program. Pilot testing at four centers revealed reasonable pre- and in-field data collection reliability, and moderate to high retest reliability for most dimensions of the measure. This report: (1) provides a literature review of parent-caregiver relations; (2) describes the development of the instrument, observer training, and data collection; (3) reports findings concerning the observer and retest reliability of the checklist; and (4) discusses findings. The report contains citations of 51 references, and, in the appendices, the PCCC coding manual and an outline of the observer training program. (RH)