This longitudinal study examined the relationship of care quality in children's homes and external day care settings to children's emotional expressions and to problem and competence behaviors. Subjects were 123 children (63 males, 60 females) mostly from middle-class Swedish families. When children were 29 months old, data about quality of care and child emotional expressions were collected in the home and day care environments. The care quality observational protocol and a supplementing interview with the mother and the external caregiver were based on the HOME instrument. When children were 4 years old, maternal, paternal, and child group leaders' ratings of externalized and internalized behavior problems were obtained in the Behar and Stringfield Preschool Behavior Questionnaire. Results showed that externalizing behaviors were related to home quality; internalizing behaviors and positive behaviors were related to quality in both settings. In general, high quality contributed to fewer problems and more positive behaviors. A low level of stimulation in the home and a high child-to-adult ratio in external care were related to more peer competence. (MM)