Background: Diagnostic validity of oppositional defiant and conduct disorders (ODD and CD) for preschoolers has been questioned based on concerns regarding the ability to differentiate normative, transient disruptive behavior from clinical symptoms. Data on concurrent validity have accumulated, but predictive validity is limited. Predictive validity is critical to refuting the hypothesis that diagnosing ODD and CD in young children leads to pathologizing normal behavior. ODD and CD have emerged as gateway disorders to many forms of adult psychopathology. Establishing how early we can identify symptoms and disorders that herald poor prognosis is one of the most important goals for research on etiology and prevention. Methods: Subjects were 3-5-year-old consecutive referrals to a child psychiatry clinic (n = 123) and demographically matched children from a pediatric clinic (n = 100). A diagnostic interview was used to assess DSM-IV ODD and CD in a prospective follow-up design from preschool to school age. Stability of ODD and CD diagnoses and level of impairment were tested as a function of preschool diagnosis. Results: Over 80% of preschoolers diagnosed with ODD and approximately 60% of preschoolers diagnosed with CD met criteria for the same disorder during follow-up. Impairment over time varied significantly as a function of stability of diagnosis across three years. Conclusions: These results provide the first evidence of the predictive validity of DSM-IV ODD and CD in clinically referred preschool children. The findings challenge the assumption that symptoms of disruptive behavior disorders that occur during the preschool period tend to be transient. (Contains 2 tables and 3 figures.)