Objective: A previous laboratory-based study found elevated cortisol levels in anxious children susceptible to CO2-induced panic, but the effects of parent diagnosis were not considered. The current home-based study tested the hypothesis that parental panic disorder and offspring response to CO2 are associated with elevated cortisol levels in juvenile offspring. Method: A total of 131 offspring (ages 9–19) of parents with panic disorder, major depression, and no mental disorder underwent CO2 inhalation. Parent and child diagnoses were assessed. Salivary cortisol was assayed before and after CO2 inhalation. Results: Neither parents with panic disorder, parents with major depression, or offspring anxiety predicted offspring cortisol levels. Independent of parent and child diagnoses, anxiety response to CO2 predicted elevated cortisol levels in offspring. Conclusions: As in adults, anxiety response to CO2 in juveniles is associated with elevated cortisol levels, but elevated cortisol levels are not related to parent or child diagnoses.