AbstractModal logic is the foundation for a versatile and well-established class of knowledge representation formalisms in artificial intelligence. Enriching modal logics with non-monotonic reasoning capabilities such as preferential reasoning as developed by Lehmann and colleagues would therefore constitute a natural extension of such KR formalisms. Nevertheless, there is at present no generally accepted semantics, with corresponding syntactic characterization, for preferential consequence in modal logics. In this paper we fill this gap by providing a natural and intuitive semantics for preferential and rational modal consequence. We prove representation results for both preferential and rational consequence, which paves the way for effect...