This paper reviews several studies on preschoolers' perceptions of alcohol and drug use. The studies make five main points: (1) the process of socialization to alcohol and drug involvement begins earlier than adolescence, and involves the ability to identify alcohol and drugs by name, class, and smell; (2) the process of socialization involves children's ability to articulate differences between alcohol and drugs, and other substances which only adults use; (3) knowledge of the rule structure about alcohol use already exists during the preschool years; (4) some preschoolers are able to articulate a belief structure about drug effects and describe expectancies about their future use and their like or dislike of drug substances; and (5) individual differences in children's learning about alcohol and drugs are related to differences in cognitive capacity and exposure to alcoholic beverages in children's homes. Children's knowledge of drugs and alcohol is characterized as a cognitive schema about use which (1) involves recognizing a special class of objects having particular smells; (2) is governed by a rule structure, perceived to vary for age and sex; (3) disallows children's use of substances; and (4) allows for incorporation of substance use into children's anticipated future behavior and sense of self as adults. A list of 22 references is provided. (BC)