Animal welfare is becoming increasingly important, especially for animal owners. In particular, prey animals such as horses generally suffer in silence. To improve the evaluation of animal welfare in practice and to simplify it in scientific research, new welfare indicators are needed that are easier to assess, less time consuming, and repeatable. Therefore, this thesis aimed to investigate laterality as a welfare indicator that could meet these requirements. Domestic horses were used as model organisms as they display sensory and motor laterality on individual and/or population level; their sensory organs are placed laterally, non-invasive stress hormone analysis is already well-established, as a highly social animal that evolved on open ranges it is prone to suffering from inappropriate human management regimes, and it displays various stress responses. In STUDY it could be demonstrated that a shift to an enhanced preference for the right brain hemisphere was in line with increased stress hormone concentrations in faeces. Sensory laterality and motor laterality measured while grazing, shifted to the left when natural needs were restricted by a change from group to individual housing. Sensory laterality changed immediately after the change of housing conditions, whereas the motor laterality changed with a time delay of one week. STUDY 2 demonstrated that motor laterality measured as initial forelimb use correlated with the cognitive bias (welfare indicator). Right-sided horses were faster to approach an ambiguous stimulus and therefore displayed a positive cognitive bias. But neither motor laterality, measured through grazing stance, nor sensory laterality were related to cognitive bias. STUDY 3 demonstrated that a preference for left side sensory organ use is not only evident in negative contexts but also in positive contexts, because the horses also preferred their left side during affiliative interactions that are assumed to induce positive emotions. This study demonstrated that not only the direction of shift in laterality, but also the context of the shift, should be recorded to reliably identify poor or good welfare. Therefore, it is recommended that additional stress parameters be applied to reliably evaluate animal welfare. STUDY 4 investigated whether the sampling and analysis of faecal stress hormones and immunoglobulin A could be simplified by applying a novel conservation method. Often it is not possible to immediately freeze the faecal samples and/or the transportation to the lab is lengthy. The study demonstrated that faecal samples can be dried a closed system such as an air-tight tube containing silica gel. The samples were dried within 24 hours, as fast as in controlled air-drying conditions at room temperature. The new and simpler drying method prevented the stress hormones (glucocorticoid metabolites) from enzymatic degradation and conserved them, demonstrated by the fact that the detectable concentration remained unchanged. In contrast, immunoglobulin A showed a reduction in the detectable concentration. Therefore, if possible, the conservation of faecal samples should be avoided when immunoglobulin A is to be analysed, although it would be possible to apply an extrapolation to attain fairly reliable results. This new drying method will simplify research on wild horses into the type of stressors they are confronted with, the impact of natural stressors, and effect of stressors on, for example, their laterality in comparison with domestic horses. STUDY 5 investigated whether the strength of laterality provides insight into basal physiological and immunological status, stress response, stress reactivity, or cognitive bias. Only a correlation between age and the strength of laterality was found, with strength of laterality increasing with age. However, age could explain only 30 per cent of the inter-individual variation in strength of laterality. The results demonstrated that the strength of laterality is not a reliable indicator of animal welfare. The direction of laterality may be of greater importance. Altogether, it was demonstrated that laterality is a promising, reliable, repeatable, and objective indictor of animal welfare, which is quick and easy to asses, and inexpensive. Like other well-established welfare and stress indicators, laterality has its limitations. Therefore, it is recommended that other welfare indicator should be simultaneously assessed and changes in laterality recorded, as different traits and personalities result in a high inter-individual variation in base laterality indices. Possible influences and correlations between emotional processing and cerebral lateralization are discussed. Nonetheless, further research is needed to establish a more reliable measurement of motor laterality, and to better understand the relationship between emotional processing and lateralization, as well as possible influencing factors.