In this paper, we address the issue of how Gelfond and Lifschitz's answer set semantics for extended logic programs can be suitably modified to handle prioritized programs. In such programs an ordering on the program rules is used to express preferences. We show how this ordering can be used to define preferred answer sets and thus to increase the set of consequences of a program. We define a strong and a weak notion of preferred answer sets. The first takes preferences more seriously, while the second guarantees the existence of a preferred answer set for programs possessing at least one answer set. Adding priorities to rules is not new, and has been explored in different contexts. However, we show that many approaches to priority handling, most of which are inherited from closely related formalisms like default logic, are not suitable and fail on intuitive examples. Our approach, which obeys abstract, general principles that any approach to prioritized knowledge representation should satisfy, handles them in the expected way. Moreover, we investigate the complexity of our approach. It appears that strong preference on answer sets does not add on the complexity of the principal reasoning tasks, and weak preference leads only to a mild increase in complexity.