Abstract According to the hypothesis of extended cognition (HEC), parts of the extrabodily world can constitute cognitive operations. I argue that the debate over HEC should be framed as a debate over the location and bounds of cognitive systems. The “Goldilocks problem” is how to demarcate these systems in a way that is neither too restrictive nor too permissive. I lay out a view of systems demarcation on which cognitive systems are sets of mechanisms for producing cognitive processes that are bounded by transducers and effectors: structures that turn physical stimuli into representations, and representations into physical effects. I show how the transducer–effector view can stop the problem of uncontrolled cognitive spreading that faces HEC, and illustrate its advantages relative to other views of system individuation. Finally, I argue that demarcating systems by transducers and effectors is not question-begging in the context of a debate over HEC.