We examined facial emotion recognition in 12-year-olds in a longitudinally followed sample of children with and without exposure to early life psychosocial deprivation (institutional care). Half of the institutionally reared children were randomized into foster care homes during the first years of life. Facial emotion recognition was examined in a behavioral task using morphed images. This same task had been administered when children were 8 years old. Neutral facial expressions were morphed with happy, sad, angry, and fearful emotional facial expressions, and children were asked to identify the emotion of each face, which varied in intensity. Consistent with our previous report, we show that some areas of emotion processing, involving the recognition of happy and fearful faces, are affected by early deprivation, whereas other areas, involving the recognition of sad and angry faces, appear to be unaffected. We also show that early intervention can have a lasting positive impact, normalizing developmental trajectories of processing negative emotions (fear) into the late childhood/preadolescent period.