According to several developmental theories some children are more sensitive to the quality of their environment than others, but most supporting empirical evidence is based on relatively distal markers of hypothesized sensitivity. This study provides evidence for the validity of behaviorally observed Environmental Sensitivity as a moderator of parenting effects on children's early development in a sample of 292 children (Mage = 3.74; SD = 0.26) and their mothers. Sensitivity was coded using a newly developed observational measure for the specific and objective assessment of Environmental Sensitivity, the Highly Sensitive Child-Rating System (HSC-RS). HSC-RS factorial structure, associations with temperament traits, and interactions with parenting quality in the prediction of socioemotional child outcomes are reported. Findings supported a 1-factor solution. Observed sensitivity was relatively distinct from observed temperament and interacted with both low and high parenting quality in the development of behavior problems and social competence at ages 3 and 6.