There is currently no overarching theory of developmental psychology, but there are several approaches to which researchers more or less adhere. One useful way of categorizing these theoretical approaches is based on the way each theory parses the developmental trajectory. Some theories, called stage theories, divide the life span into qualitatively different segments. Others, called incremental theories or continuous theories, suggest that the sweeping changes seen across the life span are the result of incremental advances in a person's abilities.

The most influential stage theory--in fact, the most influential theory in developmental psychology, period--was introduced by Jean Piaget in books and papers written in the 1920s and the decades after. Piaget suggested that children went through four stages of development through their childhood, during which qualitatively different rules applied to their behavior and growth. Although there were some similarities between the stages and some rules of behavior that applied throughout the life course, Piaget argued that the best way to understand development was by focusing on the qualitative differences between each stage and the processes involved in moving from one stage to the next. Although stage theories are less popular now than when Piaget introduced his, they still hold some sway over developmental psychologists' explanations of behavior. However, most psychologists now tend more toward some version of incremental theory, described below, than they do towards stage theories.

Incremental or continuous theories of development argue that behavior across the life span cannot be divided into qualitatively different stages, although behavior does qualitatively change as we grow older. These changes are, rather, due to basic principles of growth and development that lead to new developments as the child and adult interact with the world. Changes are gradual, not sudden, and they typically involve small, incremental changes in the individual's understanding of the world and his or her behavior towards it. The information-processing account is one prominent example of an incremental theory. According to this theory, children's improvements in performance and acquisition of new skills are dependent on some basic cognitive factor, such as working memory capacity. As working memory capacity increases, the child is able to acquire qualitatively new skills and abilities.