Following the phallic stage in Freud's theory of psychosexual development, children enter a phase called the latency period, which lasts from approximately six to twelve years of age. Unlike earlier stages, where sexual impulses played a central role, Freud believed these impulses are repressed during the latency period, becoming part of the unconscious. This stage is often described as a time of psychological calm after the turbulence of the phallic stage.

The latency period is not considered a true stage of development because Freud believed no significant psychosexual progress takes place. Instead, children shift their focus to other areas of life, such as education, friendships, and extracurricular activities like sports or hobbies. This redirection of energy allows children to develop new skills and interests without the distraction of sexual feelings, which remain dormant during this time.

Social relationships also change during the latency period. Children tend to associate more with peers of the same sex, reinforcing their gender identity. For instance, boys may prefer playing sports with other boys, while girls might form close-knit friendship groups with other girls. Consistent with Freud's observations, many children at this age view the opposite sex as unappealing or "gross," an attitude reflecting the dormancy of sexual impulses during this time. This phase sets the foundation for the reawakening of sexual interests during adolescence, in the next stage of development.