Children who do not develop appropriate social skills during early childhood are at-risk for later social adjustment problems. Measures that can be used on an ongoing basis to monitor the growth and development of social skills are needed to ensure appropriate development of social competence during the preschool years. Unfortunately, such measures do not exist. The purpose of this investigation was to develop and gather psychometric evidence for a general outcome measure to inform decision-making about social competence development in preschool children. The Proactive Assessment of Social Skills (PASS) is an observational system (analogue cooperative problem-solving activities and an observational code) designed to: a) screen all children; b) identify children at risk; and c) evaluate effectiveness of interventions. Research questions specifically addressed convergent construct validity, general construct validity, reliability (stability and alternate-form/alternate activity), and sensitivity to growth and development. Participants included 53 four-and five- year old children and teachers recruited from Head Start programs. Eight PASS observations, across two types of analogue cooperative problem solving activities (e.g. puzzles and blocks) were conducted over the course of the study. Additionally, naturalistic observations and rating scales served as criterion measures. Teachers' reports of negative behaviors matched the observational data of negative behaviors. Non-goal directed social turns observed across both activities and on-task behavior observed during the block activities were moderately correlated with teacher judgments of social competence. Negative behaviors observed during the PASS observations were also correlated with naturalistic observations of negative behaviors. A significant positive correlation was found between non-goal directed social turns during the puzzle activity and goal directed social turns during the naturalistic observations. With respect to distinguishing group differences, cooperative play behaviors observed during block activities effectively distinguished children ranked as low socially skilled by teachers. Social turns were the only behaviors that were stable across alternate forms of the same activity, and somewhat stable across alternate activities. Social turns also significantly measured growth over time as compared to teacher ratings. These findings provide a foundation for identifying key indicators of social competence. Researchers are encouraged to review the contributions and limitations of this project to advance assessment technology. (author abstract)