Observational learning is probably one of the most powerful factors determining progress during child development. When learning a new skill, infants rely on their own exploration; but they also frequently benefit from an adult’s verbal support or from demonstration by an adult modeling the action. At what age and under what conditions does adult demonstration really help the infant to learn a novel behavior? In this review, we summarize recently published work we have conducted on the acquisition of tool use during the second year of life. In particular, we consider under what conditions and to what extent seeing a demonstration from an adult advances an infant’s understanding of how to use a tool to obtain an out-of-reach object. Our results show that classic demonstration starts being helpful at 18 months of age. When adults explicitly show their intention prior to demonstration, even 16-month-old infants learn from the demonstration. On the other hand, providing an explicit demonstration (“look at how I do it”) is not very useful before infants are ready to succeed by themselves anyway. In contrast, repeated observations of the required action in a social context, without explicit reference to this action, considerably advances the age of success and the usefulness of providing a demonstration. We also show that the effect of demonstration can be enhanced if the demonstration makes the baby laugh. Taken together, the results from this series of studies on observational learning of tool use in infants suggest, first, that when observing a demonstration, infants do not know what to pay attention to: demonstration must be accompanied by rich social cues to be effective; second, infants’ attention is inhibited rather than enhanced by an explicit demand of “look at what I do”; and finally a humorous situation considerably helps infants understand the demonstration.