AbstractThe present study examined two key aspects of young children's ability to explain human behaviour in a mentalistic way. First, we explored desires that are of a level of difficulty comparable with that of false beliefs. For this purpose, the so‐called ‘alternative desires’ were created. Second, we examined how children's psychological explanations are related to their understanding of perception and intention. A perception‐understanding task, an intention‐understanding task and a psychological‐explanation task were administered to 80 three‐year‐olds. Results offer support for the thesis that the level of difficulty of belief and desire explanations is comparable. Moreover, children's psychological explanations are related to their understanding of perception and intention. The results lend support to the idea that mentalistic explanations are an explicit manifestation of children's level of theory of mind. Copyright © 2008 John Wiley & Sons, Ltd.