Childhood adversity has been shown to increase the risk of psychotic symptoms in adult life. However, there are no previous studies looking at the association between experiencing a natural disaster during childhood and the development of psychotic symptoms in young adulthood. Eight hundred and six bushfire-exposed children and 725 control children were evaluated following the 1983 South Australian bushfires. Five hundred and twenty nine (65.6%) of the bushfire group and 464 (64%) controls participated in a follow up study 20 years later. Childhood data on emotional and behavioural disorders and dysfunctional parenting was available. The adult assessment included the Australian National Health and Well-Being psychosis screen and detailed information about trauma, childhood adversity and alcohol and cannabis abuse. 5.6% of subjects responded positively to the psychosis screen and 2.6% responded positively to a further probe question. Psychotic symptoms were more common in subjects exposed to a greater number of traumas, and were associated with higher rates of childhood adversity, emotional and behavioural disturbance, dysfunctional parenting, and alcohol and cannabis abuse. Subjects exposed to bushfires as children did not have a greater risk of psychosis. Our results indicate that exposure to multiple traumas, rather than a single major trauma, increases the risk of later psychosis.