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Karl N. Llewellyn was one of the founders and major figures of legal realism, and his many keen insights have a central place in American law and legal understanding. Key to Llewellyn's thinking was his conception of rules, put forward in his numerous writings and most famously in his often mischaracterized declaration that they are 'pretty playthings'. Previously unpublished, "The Theory of Rules" is the most cogent presentation of his profound and insightful thinking about the life of rules. This book frames the development of Llewellyn's thinking and describes the difference between what rules literally prescribe and what is actually done, with the gap explained by a complex array of practices, conventions, professional skills, and idiosyncrasies, most of which are devoted to achieving a law's larger purpose rather than merely following the letter of a particular rule. Edited, annotated, and with an extensive analytic introduction by leading contemporary legal scholar Frederick Schauer, this rediscovered work contains material not found elsewhere in Llewellyn's writings and will prove a valuable contribution to the existing literature on legal realism.