Factors influencing the stability of child competence from 30 months to 48 months of age are investigated using structural equation model techniques in a population at presumed risk for mental disorder because their mothers have a diagnosed psychiatric disturbance. This method allows for the simultaneous analysis of many variables in testing hypotheses about causalify in longitudinal investigations. Child competence was defmed in terms of cognitive and social variables. Background environmental variables included were social class, race, and maternal psychopathology. Threc models were examined in this study. The first model posited direct effects of child factors as well as effects of background envimnmental facton in the stability of child competence. The second model posited only effects of background variables, with no direct child effects. The third model posited child effects and a subset of the background effects in the first model. The second model, one that did not include direct child effects, wa...