This study examined how children's emotions affect their responses to adult conflict. A total of 64 children aged 4 through 8 heard a simulated interadult conflict in the next room after they were induced to feel angry, sad, happy, or "just O.K." Assessments of children's affect, cognitions, and behaviors consistently revealed that children in sad and angry moods exhibited the most sensitivity, behavioral dysregulation, and distress in response to the adult conflict. Positive emotional arousal, on the other hand, had a protective effect on certain dimensions of children's functioning during adult discord. Findings are discussed as support for the idea that negative emotional arousal and dysregulation are contributing mechanisms in the relationship between angry environments and child psychotherapy. (Author/MDM)