We discuss the classical statistics of isolated subsystems. Only a small part of the information contained in the classical probability distribution for the subsystem and its environment is available for the description of the isolated subsystem. The “coarse graining of the information” to micro-states implies probabilistic observables. For two-level probabilistic observables only a probability for finding the values one or minus one can be given for any micro-state, while such observables could be realized as classical observables with sharp values on a substate level. For a continuous family of micro-states parameterized by a sphere all the quantum mechanical laws for a two-state system follow under the assumption that the purity of the ensemble is conserved by the time evolution. The correlation functions of quantum mechanics correspond to the use of conditional correlation functions in classical statistics. We further discuss the classical statistical realization of entanglement within a system corresponding to four-state quantum mechanics. We conclude that quantum mechanics can be derived from a classical statistical setting with infinitely many micro-states.