The purpose of this study was to predict placement and nonplacement outcomes for mildly handicapped three through five year old children given knowledge of developmental screening test data. Discrete discriminant analysis (Anderson, 1951; Cochran & Hopkins, 1961; Goldstein & Dillion, 1978) was used to classify children into either a placement or nonplacement group using developmental information retrieved from longitudinal Child Find records (1982-89). These records were located at the Florida Diagnostic and Learning Resource System (FDLRS) in Sarasota, Florida and provided usable data for 602 children. The developmental variables included performance on screening test activities from the Comprehensive Identification Process (Zehrbach, 1975), and consisted of: (a) gross motor skills, (b) expressive language skills, and (c) social-emotional skills. These three dichotomously scored developmental variables generated eight mutually exclusive and exhaustive combinations of screening data. Combined with one of three different types of cost-of-misclassification functions, each child in a random cross-validation sample of 100 was classified into one of the two outcome groups minimizing the expected cost of misclassification based on the remaining 502 children. For each cost function designed by the researchers a comparison was made between classifications from the discrete discriminant analysis procedure and actual placement outcomes for the 100 children. A logit analysis and a standard discriminant analysis were likewise conducted using the 502 children and compared with results of the discrete discriminant analysis for selected cost functions.