The papers in this volume comprise the refereed proceedings of the conference 'Artificial Intelligence in Theory and Practice' (IFIP AI 2006), which formed part of the 19th World Computer Congress of IFIP, the International Federation for Information Processing (WCC- 2006), in Santiago, Chile in August 2006. The conference is organised by the IFIP Technical Committee on Artificial Intelligence (Technical Committee 12) and its Working Group 12.5 (Artificial Intelligence Applications). All papers were reviewed by at least two members of our Programme Committee. The best papers were selected for the conference and are included in this volume. The international nature of IFIP is amply reflected in the large number of countries represented here. The conference featured invited talks by Rose Dieng, John Atkinson, John Debenham and myself. IFIP AI 2006 also included the Second IFIP Symposium on Professional Practice in Artificial Intelligence, organised by Professor John Debenham, which ran alongside the refereed papers. I should like to thank the conference chair. Professor Debenham for all his efforts in organising the Symposium and the members of our programme committee for reviewing an unexpectedly large number of papers to a very tight deadline. This is the latest in a series of conferences organised by IFIP Technical Committee 12 dedicated to the techniques of Artificial Intelligence and their real-world applications. The wide range and importance of these applications is clearly indicated by the papers in this volume. Further information about TCI 2 can be found on our website http://www.ifiptcl2.org.