Perception and interpretation of goal-directed behaviour is one of the crucial social-cognitive skills in the field of human cognition. At a very early age, infants start to be able to perceive and interpret a human action as goal-directed. This early ability is often viewed as an important precursor for intentional understanding and, even more importantly, for later Theory of Mind development. A question which is discussed controversially is how infants' abilities to perceive and understand goal-directed human actions are interrelated with their competence to perform the same behaviour. There is ample evidence that in adults, perception and production of an action share a common representational ground where planned actions are represented in the same format as perceived events [e.g. Common Coding Principle, 1, 2]. However, studies on the development of this interrelation have yielded contradictory results. The present chapter integrates various findings from different studies investigating perception, production, and imitation of goal-directed actions and discusses them in the light of existing hypotheses and theories on the development of action perception and production.