Although psychotic phenomena in children with disruptive behavior disorders are more common than expected, their prognostic significance is unknown. To examine the outcome of pediatric patients with atypical psychoses, a group of 26 patients with transient psychotic symptoms were evaluated with clinical and structured interviews at the time of initial contact (mean age, 11.6 ± 2.7 years) and at follow-up 2 to 8 years later. Measures of functioning and psychopathology were also completed at their initial assessment. Risk factors associated with adult psychotic disorders (familial psychopathology, eyetracking dysfunction in patients and their relatives, obstetrical complications, and premorbid developmental course in the proband) had been obtained at study entry. On follow-up examination (mean age, 15.7 ± 3.4 years), 13 patients (50%) met diagnostic criteria for a major axis I disorder: three for schizoaffective disorder, four for bipolar disorder, and six for major depressive disorder. The remaining 13 patients again received a diagnosis of psychotic disorder not otherwise specified (NOS), with most being in remission from their psychotic symptoms. Among this group who had not developed a mood or psychotic disorder, disruptive behavior disorders were exceedingly common at follow-up and were the focus of their treatment. Higher initial levels of psychopathology, lower cognitive abilities, and more developmental motor abnormalities were found in patients with a poor outcome. Obstetrical, educational, and family histories did not differ significantly between the groups. Through systematic diagnostic evaluation, children and adolescents with atypical psychotic disorders can be distinguished from those with schizophrenia, a difference with important treatment and prognostic implications. Further research is needed to delineate the course and outcome of childhood-onset atypical psychoses, but preliminary data indicate improvement in psychotic symptoms in the majority of patients and the development of chronic mood disorders in a substantial subgroup.