Ostracism has been shown to induce considerable physiological, behavioral and cognitive changes in adults. Previous research demonstrated its effects on children’s cognitive and behavioral abilities, but less is known about its impact on their capacity to recognize subtle variations in social cues. The present study aimed at investigating whether social manipulations of inclusion and ostracism modulate emotion recognition abilities in children, and whether this modulation varies across childhood. To do so, 5- and 10-year-old children participated in a computer-based ball tossing game called Cyberball during which they were either included or ostracized. Then, they completed a facial emotion recognition task in which they were required to identify neutral facial expressions, or varying levels of intensity of angry and fearful facial expressions. Results indicated lower misidentification rates for children who were previously ostracized as compared to children who were previously included, both at 5 and 10 years of age. Moreover, when looking at children’s accuracy and sensitivity to facial expressions, 5-year-olds’ decoding abilities were affected by the social manipulation, while no difference between included and ostracized participants was observed for 10-year-olds. In particular, included and ostracized 10-year-old children as well as ostracized 5-year-olds showed higher accuracy and sensitivity for expressions of fear as compared to anger, while no such difference was observed for included 5-year-olds. Overall, the current study presents evidence that Cyberball-induced inclusion and ostracism modulate children’s recognition of emotional faces.