The burden of dementia in China is expected to increase dramatically. This study aimed to estimate the potential impact of early parental death on cognitive functioning in late life and whether education is a possible mechanism underlying this association. Data were derived from the 2002 and 2005 waves of the Chinese Longitudinal Healthy Longevity Survey. The final sample consisted of 10,953 Chinese older adults aged 80 to 105 years. Logistic regression models were used to estimate the impact of early parental death and education on the odds of severe cognitive impairment in older men and women. Results showed that experiencing the death of a mother at or before 16 years of age significantly increased the risk of severe cognitive impairment in older men (but not women), independent of demographic, socioeconomic, and physical health conditions. This association did not persist over a 3-year follow-up period and was not mediated by education. These findings provide further evidence that childhood trauma is associated with adverse adult health outcomes, in this case the death of a mother in early life and cognitive impairment in late life. Potential mechanisms that may link early parental death to worse cognitive functioning over the life course were discussed.