We examined an advanced form of emotion understanding in 4- to 10-year-olds and adults (N = 264): Awareness that people’s minds generalize from past emotional episodes to bias how they feel, think, and make decisions in new situations. Participants viewed scenarios on an eye tracker, each featuring an initial perpetrator who caused a character to feel positively (P) and/or negatively (N) in 2-event sequences (NN, PP, NP, PN). Later, the character encountered a new agent who was highly similar to the initial perpetrator. Participants predicted the character’s affective reactions (emotions, thoughts, decisions) to the unknown agent while we recorded their eye movements to past episodes. Participants also judged characters’ emotions upon seeing additional agents, who differed in degree of similarity to the initial perpetrator. Four- to 5-year-olds discounted pasts with initial perpetrators—believing instead that characters would feel happy, anticipate good, and approach new agents. In contrast, adults exhibited robust beliefs that people generalize from past emotional experiences: They attributed more positive responses to new agents following PP > NP > PN > NN pasts, and they expected characters to have biased emotional reactions to even somewhat dissimilar new agents. Between 6 and 10 years, children increasingly assumed that the past would have a biasing impact; however, they drew stricter boundaries than did adults. Eye-tracking analyses revealed that all age groups attended to characters’ emotional past histories when reasoning about reactions to new agents (especially negative events), adults prioritized recent negative events in PN pasts, and participants’ attention biases to past event information correlated with their reasoning about emotion generalization. (PsycInfo Database Record (c) 2021 APA, all rights reserved)