This paper aims to review means, methods and approaches used by Carlo Collodi in his literary and artistic display about the development and growth od individual, the character of Pinocchio. It strives to analyze and interpret Collodi`s Pinocchio, through the symbolism of a wooden puppet which has characteristics of an living being. Further more, it aims to show how the application of children`s literature in working with preschool children affects the gradual adoption of the fundamental values of life, and the formation of a child`s personality. The main character of Pinocchio is characterized by the eternal clash between the accepted norms and the „pinocchioable” in his character, and as such can be a model that becomes applicable and effective in an appropriate manner, while working with children. The presentation of the literary and social context of Collodi`s creativity – from which derived his most famous work – Pinocchio is shown through the reference to the historical period in which he lived. Pinocchio ended former didactic literature for children. Collodi`s Pinocchio, due to it`s complex symbolism layered structure and timeless subject matter, provokes the attention of audiences of all ages, literary critics, philosophers, artists, various professionals and other authors. As a classic of children`s literature, it still, after more than a century, provides the inspiration for many works of art such as animation, film and music.