In recent years, the field of language acquisition has come to recognize that exposure to two languages in infancy is almost as common as monolingual exposure and that any theory of language development should also explain the early acquisition of two languages. Consequently, bilingual first-language acquisition, or BFLA (referring to both bilingual and multilingual development), has become the focus of much research around the world. Despite this interest, however, studies of bilingual development have been dominated, at least until very recently, by a monolingual perspective with bilingual speakers being typically seen as "two monolinguals in one." Thus, one of the major issues that has preoccupied researchers has been that of language differentiation (i.e., whether and when young bilingual children differentiate language-specific sounds, words, and rules for each of their languages). This focus arose after Volterra and Taeschner (1978) proposed that bilingual children initially use their languages indiscriminately because of a unitary or fused system at the phonological, lexical, and syntactic levels (the unitary language system hypothesis). According to them, bilingual children differentiate their words into two separate lexicons only in a second stage, and around age 3-in a third stage-they differentiate their grammatical rules into two distinct sets, one for each language. Although many studies on BFLA followed Volterra and Taeschner's proposal, investigators also began to look at children's ability to differentiate languages in context, that is, while addressing speakers of distinct languages. The differentiated language system hypothesis, proposed by Genesee (1989), claimed that by the time bilingual-to-be children begin talking, they show signs of differentiating their phonology, lexicon, and language choices. Likewise, as soon as there is evidence for syntax, they use their two syntactic systems differentially.The proposal of an initially undifferentiated system in BFLA was the basis of bilingual-monolingual comparisons and implied that bilingually exposed babies experience prolonged language development during the process of learning two languages. However, there has been a trend in the past decade to move away from viewing, studying, and assessing bilingual children as two monolingual children in one. The literature reviewed in this chapter shows how studies related to BFLA have evolved over the years from an analysis of the emergence of separate linguistic systems to a focus on the particular features of bilingual speech or the characteristics of dual language environments and practices. After reviewing the work on differentiation and development in early bilingualism, this chapter discusses literature on the impact of the language environment in terms of family language policies and the role of input from parents, siblings and grandparents. Current perspectives that accept code-mixing