Background: We examined the prevalence and nature of comorbid post-traumatic stress reactions and depressive symptoms, and the impact of exposure to traumatic events on both types of psychopathology, among Palestinian children during war conflict in the region. Methods: The 403 children aged 9-15 years, who lived in four refugee camps, were assessed by completing the Gaza Traumatic Events Checklist, the Child Post Traumatic Stress Reaction Index (CPTSD-RI), and the Short Mood and Feelings Questionnaire (MFQ). Results: Children reported experiencing a wide range of traumatic events, both direct experience of violence and through the media. CPTSD-RI and MFQ scores were significantly correlated. Both CPTSD-RI and MFQ scores were independently predicted by the number of experienced traumatic events, and this association remained after adjusting for socioeconomic variables. Exposure to traumatic events strongly predicted MFQ scores while controlling for CPTSD-RI scores. In contrast, the association between traumatic events and CPTSD-RI scores, while controlling for MFQ scores, was weak. The CPTSD-RI items whose frequency was significantly associated with total MFQ scores were: sleep disturbance, somatic complaints, constricted affect, impulse control, and difficulties in concentration. However, not all remaining CPTSD-RI items were significantly associated with exposure to traumatic events, thus raising the possibility that the association between depression and PTSD was due in part to symptom overlap. Conclusions: Children living in war zones are at high risk of suffering from PTSD and depressive disorders. Exposure to trauma was not found to have a unique association with PTSD. The relationship between PTSD and depressive symptomatology requires further investigation.