This study addressed the following question: are the adolescent and young adult offspring of parents with early-onset dysthymic disorder (DD) at increased risk for psychopathology? Participants included 41 offspring of 21 outpatients with early-onset DD, 19 offspring of nine outpatients with episodic major depressive disorder (MDD), and 32 offspring of 11 normal controls (NCs). Lifetime best-estimate diagnoses were determined for each offspring using a team consensus method. Diagnoses were derived blind to all information about the index parents. The offspring of outpatients with early-onset DD exhibited significantly higher lifetime rates of a broad range of psychiatric disorders than the offspring of NCs. In addition, the offspring of outpatients with early-onset DD exhibited significantly higher lifetime rates of DD, anxiety disorders, and phobia than the offspring of outpatients with episodic MDD. These results support the importance of early-onset DD in parents as a risk factor for psychopathology in their offspring.