Although preschoolers learn from educational TV, they may not use information appropriately due to their developing understanding of video and fantasy-reality distinctions. Seventy 3- to 5-year-olds watched a Sesame Street clip, introduced as either "fun" or "for learning," that depicted aspects of Hispanic culture (e.g., fiestas). They answered comprehension questions and rated the reality of the educational and fantasy content. Approximately a week later, a seemingly unrelated interviewer asked for help planning a fiesta (transfer task), then reassessed memory and reality judgments. Regardless of condition, children retained most of what they learned, but all ages became increasingly skeptical about the reality of both the educational and fantasy content. Consistent with theorizing about transfer, children’s use of the educational content depended on both memory and reality judgments. Older children remembered the information better than younger children, but memory only predicted transfer if the information was remembered as real.