Little is known about the role of stress reactivity in the emergence of psychopathology across early childhood. In this longitudinal study, we tested the hypothesis that child cortisol reactivity at age 3 moderates associations between early parenting and children's internalizing and externalizing symptoms from age 3 to age 6. One hundred and sixty children were assessed at age 3, and 135 children were reassessed at age 6. At age 3, we exposed children to stress-inducing laboratory tasks, during which we obtained four salivary cortisol samples, and parental hostility was assessed using an observational parent–child interaction task. At ages 3 and 6, child psychiatric symptoms were assessed using a clinical interview with parents. The results indicated that the combination of high child cortisol reactivity and high observed parental hostility at age 3 was associated with greater concurrent externalizing symptoms at age 3 and predicted increases in internalizing and externalizing symptoms from age 3 to age 6. Findings highlight that increased stress reactivity, within the context of hostile parenting, plays a role in the emergence of psychopathology from preschool to school entry.