In order to examine the mechanism whereby stunted children have poor developmental levels, we compared the behaviour of stunted (N=78) and nonstunted (N=26) children aged 12 to 24 months, and examined the relationship of their behaviour to their developmental levels. The effect of nutritional supplementation with or without psychosocial stimulation on the stunted children's behaviour was also examined. The children were observed at home during 4 days over a period of 6 months. The stunted children showed significantly more apathy, and less enthusiasm and variety in exploring, were less happy and more fussy. Caretakers' vocalisations to them were less warm or instructive. Stunted children's activity level, exploratory and happy behaviours were predictive of change in developmental levels measured on the Griffiths Scales, from enrolment to 12 and 24 months later. Supplementation predicted mental age at 12 and 24 months after enrolment, however, it had no significant effect on behaviour.