From PEOPLE Magazine Click to enlarge
At 8 years old, Willow Smith is already getting the hang of the family business: making blockbusters. She starred in last year's I Am Legend with her dad, Will Smith, and now she's sharing the screen with her mom, Jada Pinkett Smith, in Madagascar: Escape 2 Africa, the animated sequel that made $63.5 million its opening weekend. And how do her famous costars compare? "Daddy is funny and crazy and tells me things like 'feel the moment' when I'm acting," says Willow, who plays a junior version of her mom's character, Gloria the hippo, in Madagascar 2. "Mommy is cheerful and gives a lot of happiness."

Willow, who also appeared this year in Kit Kittredge: An American Girl, isn't the only Smith offspring following in her parents' footsteps into show business. Her big brother Jaden, 10, costarred with Dad in 2006's The Pursuit of Happyness and appears in The Day the Earth Stood Still, opening Dec. 12. Now Jada, 37—besides being an actress and musician—has taken on another full-time job: making sure her budding child stars keep their feet on the ground. Acting, she says, is "what they want for now. But if Jaden decides, 'You know what, Ma? I really want to be a woodchopper,' that's okay. My only dream for my children is that they be happy."

So far, so good. The bustling family compound outside L.A. also includes Trey, 16, Will's son from a previous marriage; Jada's goddaughter Tamira, 18; Will's nephew Kyle, 19; as well as three cats, two dogs and a boa constrictor named Beauty. Jada has declared the home a "non-Hollywood zone," where kids can be kids—and parents set limits. "We go to Trey's football games almost every Friday, we have family dinner, we eat breakfast together," says Jada. Adds her pal Katie Holmes: "Jada is incredibly hands-on. Her priority is her children."

At the Smith house, there are rules. "Whatever space you touch, make sure you leave it as you came into it," says Jada. Also, she says, "I'm strict about what they put into their bodies. Daddy tends to go, 'Yeah, have chocolate cake for dinner, it's all right with me!'" Now that Jaden and Willow are collecting acting paychecks, "it's a very interesting dynamic," says Jada. "You make it clear to them: 'This is your money and things you want, you'll be paying for.' Kids will be very responsible without you having to do it for them." Now when the Smith kids want to buy something, "I'm their bank," Jada explains. "They have to come to me and write up a little slip when they want a withdrawal."

Until recently the children were homeschooled (see box), and the close-knit Smiths still like nothing more than spending time together at their sprawling estate. "She throws a great Halloween party," says Holmes, who drops by with husband Tom Cruise and daughter Suri. The clans are close and have been known to get together for girls-vs.-guys karaoke night (winner of the most recent bout: the guys). "We hang out, eat, talk about life, watch movies. The kids play and ride bikes," says Cruise. "Will and Jada have a great love and great partnership."

Married nearly 11 years, the couple—who met when the Baltimore-bred Jada auditioned for Will's sitcom The Fresh Prince of Bel-Air—meet regularly to set mutual goals that are both spiritual ("to exchange abundantly with God," says Jada) and mundane (go on a family camping trip). And Jada says they keep their love life hot by reading aloud to one another from the self-help book Sexual Secrets. But their real secret, says Jada, is this: "He's funny. And he thinks I'm hilarious."

And Will, 40, is no doubt impressed by his wife's time-management skills: Jada recently wrote and directed the independent film The Human Contract and is now at work on Time Heals, a pilot for TNT—in addition to being lead singer in her funk-metal band Wicked Wisdom. "The other day, Willow said, 'Mommy, what is going on? You are working too much,'" says Jada. "I was like, 'Cool. Got it.'" That kind of reality check, she says, keeps her focused on a higher goal: raising her brood to become "happy, responsible" adults. "Jada takes care of everyone," says Holmes. "I don't know when she sleeps or if she sleeps. But she always has time for you. She wants to see people do well in their lives. And that's incredible."