This chapter explores young children's conversations as a unique linguistic, social, and cultural phenomenon, by investigating the relative salience, contexts, affordances, structures, and functions of conversation in preschoolers' peer interactions. It reviews the developmental perspective of child-language study and socio-cultural perspective of sociolinguistics and ethnography. The chapter then draws on both in analyzing naturally occurring peer conversations of young Israeli children. The socio-cultural perspective on children's conversations brings to the fore the culturally filtered nature of conversational skills, emphasizing that the specific definition of the scope of normative conversational performance is culture-sensitive and often reflects or echoes underlying cultural norms and ethos. The chapter focuses on initiation and engagement patterns and on the linguistic and topical characteristics of each segment of the interactions to demonstrate the ways preschoolers gradually move from activity-related talk to independent conversations. Then, it discusses the rare cases of non-activity-related talk in preschool peer interaction.