An ecological developmental perspective views human development from a person-in-environment context, emphasizing the principle that all growth and development take place within the context of relationships. With regard to power and breadth of influence, the family is the most influential developmental context. Early investigations on family influences focused primarily on parent to child socialization. However, current researchers view the family as a social system, comprised of a set of interdependent relationships. In this course recent theories on family functioning will be reviewed and critically analysed. Major themes include: conceptualisation of different levels of family functioning, family as a system of relationships, the role of child rearing in both normative and deviant development; bi-directional and child-effects, and developmental change in these relations. Parallel to the theoretical advances, attention will be given to the issues of measurement, design and the new methodological approaches in studying family relations in developmental perspective. Additionally, influences from outside of the family context will be analysed. The central theme will be the peer relationships, both at a dyadic (friendships) and at a group level (in and outside the school). Finally, a contextual emphasis underscores that family and peers may have different implications for children in different cultural and ecological contexts. Therefore, attention will be given to the role of cultural factors and cultural differences in socialization processes and development.