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This study addresses one aspect of conceptual development, viz. categorization, in connection with children’s compounding. It is based on diary data of 392 non-established NN compounds, spontaneously produced between age 1–6 by three Swedish children. The aim is to investigate in what domains their compounds, or conceptual combinations, are situated, and to analyse them with focus on categorization. We show that children use familiar items in compounding: more than one third of the N1s and N2s belong to the same morphological family. Taxonomically, the domains of food, clothes, animals and vehicles predominate among the compounds. The two major scripts are Eating and Getting dressed. Our data permits us to trace other categorization types as well, such as thematic, evaluative and ad hoc. Compounds relying on perceptual features, mainly shape and prints, do occur, notwithstanding that general background knowledge and abstract representations intervene. Tendencies to cross-classify entities are shown. Moreover, the children tend to subcategorize at a more detailed level than adults do, which might suggest that they have fewer, but more specified, categories in their so far limited lexicon. In conclusion, subcategorization by compounding can be seen as a powerful means for children to develop their conceptual system.