When should you prefer composition over inheritance?

Composition (has-a) includes objects as fields; inheritance (is-a) extends classes. Prefer composition when: relationship isn't truly is-a, you need flexibility to change behavior, avoiding deep hierarchies, reusing across unrelated classes. Inheritance problems: tight coupling, fragile base class, hierarchy explosion. Composition benefits: loose coupling, runtime flexibility, easier testing. Example: instead of Stack extending ArrayList, Stack contains ArrayList. Strategy pattern uses composition for interchangeable algorithms. 'Favor composition over inheritance' - Gang of Four.