The authors examined change and demonstrated variation in the prevalence of psychiatric disorders from ages 21 to 30 in a prospective community study (n = 352) using generalized estimating equations and investigated effects of past and recent psychiatric disorder on emerging adult functioning (at age 30). Results revealed significant declines in 12-month prevalence of phobia and substance use disorders from ages 21 to 30 but not in depression or posttraumatic stress disorder. Males were at significantly higher risk for lifetime substance use disorders; females were at higher risk for lifetime depression, phobia, and PTSD. Twelve-month and lifetime disorder were associated with impaired global functioning at age 30. Internalizing disorders were associated with impaired interpersonal functioning, whereas externalizing disorders were associated with impaired socioeconomic functioning. Results of this study have implications for mental health service planning in emerging adulthood.