Infants, toddlers and preschoolers are a high risk group for exposure to trauma. Young children are also vulnerable to experiencing adverse outcomes as they are undergoing a rapid developmental period, have limited coping skills and are strongly dependent on their primary caregiver to protect them physically and emotionally. However, although millions of young children experience trauma each year, this population has been largely neglected. Fortunately, over the last 2 decades there has been a growing appreciation of the magnitude of the problem with a small but expanding number of dedicated researchers and clinicians working with this population. This review examines the empirical literature on trauma in young children with regards to the following factors: (1) how trauma reactions typically manifest in young children; (2) history and diagnostic validity of posttraumatic stress disorder (PTSD) in preschoolers; (3) prevalence, comorbidity and course of trauma reactions; (4) developmental considerations; (5) risk and protective factors; and (6) treatment. The review highlights that there are unique developmental differences in the rate and manifestation of trauma symptomatology, the current "Diagnostic and Statistical Manual of Mental Disorders" (4th ed., DSM-IV-TR) PTSD criteria is not developmentally sensitive and the impact of trauma must be considered within the context of the parent-child relationship. Recommendations for future research with this population are also discussed.