This study examined young children's cooperation and competition during their social interaction in naturalistic settings. Cooperaton and competition are explained by the evolution theory which focuses on "the survival of the fittest" and achievement of the resources in a limited society and fields. In this perspective, cooperation is another form of competition. In peer culture of young children, social interaction involves cooperation and competition. Several studies on young children's cooperation and competition focused on both cooperation which occurs in the work with collaboration and competition occurring in the game activities. This means that cooperation and competition have not studied in a naturalistic setting which young children behave in their free will. Therefore, this study focused on young children's cooperation and competition which occurred in naturalistic settings by qualitative research, especially grounded theory approach by Strauss and Corbin(1998). Young children aged 4 and 5 years have been observed in their classrooms for 11 months. The researcher of this study focused on young children's social interaction with cooperation and competition in the classrooms. If young children were not in social interaction, the researcher made search for other group for the next observation. Young children's social interaction also videotaped and audiotaped during the study and the researcher make it write on the field note for further analysis. This study revealed the following results: (1)Young children's social cooperation means that first, cooperation is which young children achieve their common goals during their activities; second, cooperation is the one which young children can gain their self control and self regulation during social interaction; third, cooperation is effort between/among young children. (2)Young children's social competition means that first, competition is menat by gaining of play materials for their activities; second, competition is what young children express their inner needs during social interaction with peers; third, competition is the one by which young children want to achieve their goal during social interaction with peers; and forth, competition is the one by which young children express their aggressiveness during social interaction. In addition, young children's social competition and cooperation are observed during their social interactions with peers based on their social relationships such as friendship and nonfriendship. Several researchers pointed out that cooperation could be found in the friendship relations compared to nonfriendship relations. This study finds that competition is observed in the friendship relations as well. This study focused on microanslysis on young children's cooperation and competition during their social interactions with peers. Although young children's social culture is different from the adult culture, it reflects adult culture on their play like pretend play. Therefore, young children's social cooperation and competition needs to be studied, for the next, in the macroanlaysis which contains social cooperation and competition during adult social interactions based on their cultures.