In the study reported here, we examined the effects of fetal exposure to a synthetic stress hormone (synthetic glucocorticoids) on children’s susceptibility to postnatal sociodemographic adversity. We recruited children who were born healthy and at term. Twenty-six had been treated with steroid hormones (glucocorticoids) during the prenatal period, and 85 had not. Only children exposed to both prenatal stress hormones and postnatal sociodemographic adversity showed impaired performance on standardized tests of memory function. The association was specific to long-term memory. General intellectual functioning and expressive language were not affected by fetal glucocorticoid exposure. Results were independent of maternal intelligence and maternal depression at the time of the study. These findings are consistent with a vulnerability-stress model: Prenatal exposure to synthetic stress hormones is associated with increased susceptibility to subsequent adversity, with consequences for cognitive functioning that persist 6 to 10 years after birth.