Protective factors that contribute to the development of resiliency in children, defined as "unusually good adaptation in the face of severe stress, and an ability of the stressed person to rebound to the prestress level of adaptation," are discussed. The biological, psychological, familial, and social factors related to disadvantages that undermine the development of the precursors of resiliency are identified, and factors that protect the potential for resiliency in each of these areas are discussed. The risk and protective factors within the child, the family, and the community that are relevant to the achievement of resiliency are discussed for developmental stages from conception through the school years. Goals and models of intervention specific to each stage that have been shown to foster the development of resiliency are outlined. These goals and models are illustrated by 12 "success stories" of established programs that have either proven their ability to help significant numbers of disadvantaged children achieve resiliency or are so well-designed and promising that they are worthy of continued scrutiny while their effectiveness and efficiency are being established. Ten recommendations are made for policies that would allow greater numbers of disadvantaged children to transcend adversity and achieve their developmental potential. An executive summary from "What Determines Health?: Summaries of a Series of Papers on the Determinants of Health," commissioned by the National Forum on Health is attached. (Contains 4 tables, 3 figures, and 172 references.) (SLD)