Maternal trauma is a complex risk factor that has been linked to adverse child outcomes. Nevertheless, the mechanisms underlying its association with child behavioral outcomes are not well understood. Using a novel study design which included adoptive and biological families, the present study examined the heritable and environmental mechanisms by which maternal trauma and associated depressive symptoms are linked to child internalizing and externalizing behaviors. Path analyses were used to analyze data from 557 adoptive mother adopted child (AM-AC) dyads and 126 biological mother-biological child (BM-BC) dyads; the two family types being linked through the same biological mother. Rearing mother’s trauma was associated with child internalizing and externalizing behaviors in both AM-AC and BM-BC dyads, and this association was mediated by rearing mothers’ depressive symptoms, with the exception of BC externalizing behavior where BM trauma had a direct-influence only. The presence of significant associations between maternal trauma and child behavior in dyads that only share environment (i.e., AM-AC dyads) lends support to an environmental mechanism of influence for maternal trauma. Significant associations were also observed between maternal depressive symptoms and child internalizing and externalizing behavior in dyads that were only genetically related with no shared environment (i.e., BM-AC dyads), suggesting a heritable-pathway of influence via maternal depressive symptoms. In reducing the intergenerational effects of maternal trauma, prevention efforts should focus on addressing mental health needs of mothers who have been victims of trauma, and identifying children who may be at greater risk for problem behaviors due to environmental and hereditary influences.