"Self-directed fantasy play in the yard is an essential feature in young children's cognitive and psychosocial development," says Jane P. Perry, research coordinator at UC Berkeley's well-known Harold E. Jones Child Study Center, which is both a full-time campus child care facility and a research unit in the Institute of Human Development.

"Children really pay attention during outdoor play; their observation of each other is intense," says Perry, adding that the fantasy games can be used by teachers to advance learning in many areas including linguistic, spatial and social skills.

Her studies of preschool children in the play yard are being published this month in the book "Outdoor Play: Teaching Strategies with Young Children" (Teachers College Press, Columbia University).

Perry is strongly opposed to the current drive to test young children with standardized academic measures, which she says have shown themselves to be "incredibly unreliable" for young children.

"It is completely inappropriate to use one measure as the sole indicator of school performance," says Perry, who is also a teacher at the center in a classroom of 24 children and four teachers.

"Creators of the tests say they are not intended to be used that way. Nevertheless, teachers teach to them and children learn to think in test strategies rather than creatively and imaginatively in play."

What are children doing as they race around the yard in a pretend world? Perry asks this in her book, noting that, between the ages of three and five, children engage in more pretend play with each other than any other kind of play.

Told through poignant, often funny, episodes, Perry answers that question in an ethnography based on microanalysis of the videotapes of 10 children playing in the yard. Two teachers are there also, sometimes participating in the fantasies, ensuring safety or guiding the play with subtle cues.

Among many lessons, the children learn to communicate and cooperate with each other, solve problems and think flexibly.

Perry captures such four-year-old social openers as: "Let's play dinosaurs, OK?", "We're twins, right?" "I'm the father and you're the baby," and "You wanna play sharks?"

She records the rhythmic sing-song called "tangletalk" that children engage in as they begin to share a pretend game. Watching mud form around water spouts and planning to build a dam, three boys fall into a chant: "Goody mud butt. Goody mud butt. Goody mud water. Goody mud water. Goody mud water, we can have a whole stream! "Goody mud water, can have a whole stream."

The sing-song routine focuses their attention and integrates the players into a "stream theme," says Perry. She describes this kind of communication as the "intimate conversation of four-year-olds."

One of the most difficult lessons the children learn is how to include those who have different skill levels.

One child in the book, Lawrence, is a bit more socially inexperienced than others. He also doesn't speak English as well, because it isn't his native language. Throughout the book, Perry shows how Lawrence persists in trying to get into the children's games, sometimes making it, sometimes not. In the process, he practices new ways to speak and better ways to get along.

In one episode called "Making a Road," Lawrence tries to enter the action of three other four-year-olds who are digging roads in the sand and driving their dump trucks over them.

"You's making a new road, right?" Lawrence begins, not using any of the startup cues of the other children who came into the game calling out, "Hi, Buddy," or singing emphatically, "Da da dum." Three times he tries to get into the game and three times he is rebuffed, until finally, one of the boys offers to make Lawrence his own road.

Perry explains, "These three don't need anyone else. So the question becomes: How do you accommodate the needs of another, especially when the fourth child isn't ready to play with the same skill?

"Instead of being brutal about it and saying, 'You can't play,' they drew a line in the sand and said, 'Here's your road,' and 'You can watch us.'"

"Kids at this age have different capacities in different areas," Perry continues. "Fantasy play has to do with psychosocial development, with self esteem, and with the sense of self in context of community."

Perry's videotapes show, however, that the impact of outdoor pretend games far exceeds even the importance of psychosocial development. The outdoor games help children distinguish reality from fantasy, encourage language acquisition and promote problem-solving skills.

"Outdoor play is critically important when children's lives are increasingly regulated by the company of adults," says Perry.

Her book provides a guide for teachers who can learn to intervene from inside the game and sustain it while advancing the children's ability to learn from their own perspective.