Much research has explained regulatory focus effects via the alternative psychological states (eagerness vs. vigilance) people experience when they adopt different regulatory foci. This article identifies for the first time the cognitive mechanism that underlies regulatory focus effects. We propose that promotion-focus individuals engage in relational elaboration, which entails identifying commonalities or abstract relationships among disparate items. In contrast, prevention-focus individuals engage in item-specific elaboration, which involves focusing on specific attributes of each item independent of others. Results support our theorizing by demonstrating that promotion-focus (prevention-focus) individuals exhibit enhanced performance on tasks that require relational (item-specific) elaboration.