A year-long ethnographic case study was conducted primarily to investigate the developmental nature of children's spontaneous grouping activities in an elementary school setting. Participant observation and related methods were conducted for two days a week (on average) in a small, traditional parochial school located in a lower-class integrated neighborhood in a large eastern city. In addition, the ecology of the children's groups and the organization of the school were investigated. It was found that second-grade children displayed only facsimiles of group structures: the group in the second-grade classroom was found to be an overlapping collection of friendships. By eighth grade, true groups came into existence. Among girls, rival groups formed within the class, and status was partially conferred by group membership. As the eighth-grade children progressed from grade to grade they were seen by adult personnel as having mature group concepts and coalition dynamics, which they did not in fact possess. The school inadvertently encouraged an eighth-grade collective to turn itself into a hostile coalition by labeling it a "clique." As a consequence, the "clique" learned what the functions of a group were supposed to be and promptly became a self-proclaimed adversary group with a full complement of criterial group features. Piagetian principles and related research were helpful in interpreting the children's group behavior. (Author/RH)