Final answer:
The postconventional level of Kohlberg's Theory of Moral Development represents the stage where individuals develop an internal set of standards and values, guiding their behavior based on personal principles rather than merely adhering to societal norms.
Step-by-step explanation:
The stage of personal moral development in which an individual develops an internal set of standards and values is known as the postconventional level, according to Kohlberg's Theory of Moral Development. This stage typically emerges after adolescents have reached a certain level of cognitive maturity, understanding not only society's rules but also abstract principles and ethical values that may transcend those rules. A core part of this level of moral development is the formation of internal conflict as individuals navigate through personal morals and societal laws which may not always align. Kohlberg described a progression from preconventional morality, concerned with direct consequences to oneself, through conventional morality, where individuals adhere to social norms and laws, to the postconventional stage where moral reasoning is based on personal principles. This is a stage where people contemplate deep ethical questions and consider factors such as human rights and social justice. It signifies a shift from external authority to internalized moral principles guiding behavior.