Young children are remarkably prosocial, yet the mechanisms driving their prosociality are poorly understood. In two studies, we looked at whether a need for reciprocity drives children’s prosocial behavior. In Experiment 1, children were given a puzzle task to complete in which they were either missing 2 pieces (experimental group) or not (control group). All children then received 2 puzzle pieces from a confederate, resulting in either necessary instrumental help (experimental group) or unnecessary help (control group). Children were more prosocial (shared a greater proportion of their resources) with the confederate after receiving instrumental help than after receiving unnecessary help. In Experiment 2, we investigated the types of principles children use when paying back help. We found that children employed a mix of exact reciprocation and “needs-based” help when paying back individuals. Our results suggest an important role of gratitude and reciprocity in the development of early prosociality.