Puppetry captures the imagination and interest of young students. Stories are told and retold to children through pictures, puppets, stuffed animals, toys, dolls, gestures, dramatic voices, and theatrical effects. Many of the stories involve some moral decision or event, such as fairy tales in which the characters "live happily ever after" after overcoming some moral dilemma (Flower & Fortney, 1983). The relationship between puppetry, children's literature, and character education provides the impetus for an elementary level unit. In this article, the author addresses character education's place and relationship to school reform and art education. An example of an elementary level unit is described to further explain how character education fits into the visual art curriculum. (Contains 3 figures.)