Research Findings: The current study examined preschoolers' processing of false belief situations presented in published picture books. Children were read one story with a plot that revolved around a single false belief occurrence and one story with multiple false belief occurrences. Children's narrative retellings of the stories were utilized as a measure of their processing of the stories. Story effects were found such that children's performance was significantly better for some stories than for others. Results also revealed that children who passed the false belief question in the story tended to process the story in terms of an explicit integration of the false belief with the story events, whereas children who failed this question tended to focus on the reality of the situation or did not mention the instance in their retellings. Practice or Policy: Implications for caregivers reading to children and for future literary writers are discussed. (Contains 5 tables, 4 figures, and 3 footnotes.)