Despite the considerable amount of research demonstrating the relationship between parental depressive symptoms and child behavior problems, few studies have examined the direction of the relationship between these variables. Therefore, the purpose of this study was to examine transactional effects between parental depressive symptoms and child behavior problems. Participants were 209 parent-child dyads drawn from the Oregon Adolescent Depression Project who completed at least 2 of 4 annual questionnaire assessments between the child's age of 4 and 7 years. Structural equation modeling was used to examine the autoregressive paths from one year to the next year within each construct, as well as cross-lagged paths from one year to the next year between constructs. Findings indicated that parental depressive symptoms at each year predicted child behavior problems at the subsequent year and vice versa. No support was found for differential gender effects. These findings highlight the reciprocal relationship between parental depressive symptoms and child behavior problems and suggest intervention programs for young children should assess for and target parental depression when appropriate. Future research should examine these relationships across a broader developmental spectrum and in more diverse, heterogeneous samples.