Using a short-term longitudinal design (6 months), this study examined cumulative contextual risk as a predictor of effortful control (EC) and social competence in a community sample of children (N = 80, ages 33-40 months at time 1). Maternal parenting was examined as a mediator of contextual risk. EC was assessed using laboratory tasks, and parenting was assessed using observational ratings. Time 1 contextual risk was negatively related to time 2 EC after controlling for time 1 EC. Mothers' limit setting and scaffolding predicted higher time 2 EC and accounted for the effect of contextual risk. Time 1 EC, contextual risk, and parenting predicted time 2 social competence, and contextual risk had an indirect effect on social competence through parenting. Results suggest that contextual risk predicts smaller relative increases in EC and that parenting accounts for this effect. Knowledge of the factors that divert or promote effortful control can provide targets for intervention to enhance effortful control abilities and better adjustment.