The goal of this study was to determine if typically developing children could form grammatical categories from distributional information alone. Twenty-seven children aged six to nine listened to an artifcial grammar which contained strategic gaps in its distribution. At test, we compared how children rated novel sentences that ft the grammar to sentences that were ungrammatical. Sentences could be distinguished only through the formation of categories of words with shared distributional properties. Children's ratings revealed that they could discriminate grammatical and ungrammatical sentences. These data lend support to the hypothesis that distributional learning is a potential mechanism for learning grammatical categories in a first language.