A computer activity center was established in a preschool in order to investigate the effect of the introduction and use of microcomputers on the environment and to assess the appropriateness of computers as tools for the preschool. The center consisted of one 16K Atari 400 computer, a black and white television, a cassette memory storage device, and a joystick. Three programs were selected for use: Drawpic by Artworx, Video Easel by Atari, and Blox by Geof Nieboer. Data were gathered by continuous observation and audiotaping of children's verbal interaction. An observer checklist was used to record length of computer use per child, type of interaction, whether the children saved their work, general comments, and the number of observers at the center. A questionnaire was used to determine characteristics of the sample. Results indicated that, although the computer did not dominate the children's day or interrupt the flow of classroom activity, every child chose to work in the center once during the study. Creating no unique management problems, the computer center provided opportunities for fine motor development, creative involvement, verbal expression, problem solving, widened experience, success, and pride in achievement. (Appended are computer program descriptions, observation sheets, parent letters, a parent questionnaire, and selections from transcribed recordings of children's interaction.) (RH)