This study evaluated the extent to which first-grade class size predicted child outcomes and observed classroom processes for 651 children (in separate classrooms). Analyses examined observed child-adult ratios and teacher-reported class sizes. Smaller classrooms showed higher quality instructional and emotional support, although children were somewhat less likely to be engaged. Teachers in smaller classes rated typical children in those classes as more socially skilled and as showing less externalizing behavior and reported more closeness toward them. Children in smaller classes performed better on literacy skills. Larger classrooms showed more group activities directed by the teacher, teachers and children interacted more often, and children were more often engaged. Lower class sizes were not of more benefit (or harm) as a function of the child's family income. First-grade class size in the range typical of present-day classrooms in the United States predicts classroom social and instructional processes as well as relative changes in social and literacy outcomes from kindergarten to first grade.