Back when you were a child of 2 or so, you were virtually mindless, at least compared to how you are now. In the first few years of life, your primary focus was you: You wanted food, comfort, a colorful toy -- and you were willing to cry very loudly to get what you wanted. In return, you offered nothing but potential quiet. You were what can be called egocentric, one of the definitions of which is extreme self-centeredness. You can hardly be blamed for this, however; you hadn't developed to a point where you could look past your own needs.
Then, at about age 3 or 4 -- if you're neurotypical, meaning your mental development was comparatively normal -- you underwent what seemed like a magical transformation. You became a genius at mind-reading. You suddenly were capable of looking past yourself and could take into account others' wants, needs, knowledge and mental states. You had developed what some researchers call theory of mind.
You'll note that theory of mind is missing a "the" ahead of it. That's because this term doesn't refer to a theory on the mind. Formally, the academic concept that relates to it could be called the theory of theory of mind. It refers to a person's ability to create theories about others' minds -- what they may be thinking, how they may be feeling, what they may do next. We are able to make these assumptions easily, without even recognizing that we are doing something fundamentally amazing: We are making predictions about what is going on in other people's heads and, even more amazingly, these predictions most often prove correct.
Consider this. Let's say you're on your way to get a book from the bookcase in the living room and you enter a room where a loved one is seated with her chin to her chest, not engaged in any visible activity. You may rightly believe that this loved one is sad and stop to ask what's wrong. But what forms the basis of this belief? What is it about sitting quietly and alone, with one's head down, that suggests sadness? More importantly, what is the point of not only being able to broadcast this sadness to others, but for them to be able to receive this transmission and stop what they are doing to see what's the matter? The answers to those questions probably lie in the evolutionary benefits theory of mind could bestow.