The current study investigated 304 children from a longitudinal project (the Stress in Pregnancy (SIP) Study) who were exposed and unexposed to Superstorm Sandy (“Sandy”) in utero. They were prospectively followed from 2 to 6 years of age and their clinical and adaptive behaviors were assessed annually. Using a hierarchical linear model, the study found that in utero Sandy exposure was associated with greater clinical (anxiety, depression, and somatization) and lower adaptive behaviors (social skills and functional communication) at age 2 years. However, the trajectories were notably different between the two groups. Anxiety increased more rapidly among the exposed than unexposed group at ages 2–4, and depression increased only among the exposed. In contrast, social skills and functional communication were lower in exposed compared to unexposed children at age 2, but quickly increased and exceeded the capacities of unexposed children by age 3. The findings confirm that prenatal Sandy exposure is not only associated with an increase in anxiety, depression, and somatization in offspring, but also with greater adaptive skills as the children got older. Our study demonstrates that while children who have experienced stress in utero demonstrate elevated suboptimal clinical behaviors related to affective disorders, they nevertheless have the potential to learn adaptive skills.