Studies indicate a high prevalence of childhood trauma in patient cohorts with established psychotic disorder and in those at risk of developing psychosis. A causal link between childhood trauma and development of psychosis has been proposed. We aimed to examine the association between experience of childhood trauma and the development of a psychotic disorder in a large “Ultra High Risk” (UHR) for psychosis cohort. The data were collected as part of a longitudinal cohort study of all UHR patients recruited to research studies at the Personal Assessment and Clinical Evaluation clinic between 1993 and 2006. Baseline data were collected at recruitment to these studies. The participants completed a comprehensive follow-up assessment battery (mean time to follow-up 7.5 years, range 2.4–14.9 years), which included the Childhood Trauma Questionnaire (CTQ), a self-report questionnaire that assesses experience of childhood trauma. The outcome of interest was transition to a psychotic disorder during the follow-up period. Data were available on 233 individuals. Total CTQ trauma score was not associated with transition to psychosis. Of the individual trauma types, only sexual abuse was associated with transition to psychosis (P = .02). The association remained when adjusting for potential confounding factors. Those with high sexual abuse scores were estimated to have a transition risk 2–4 times that of those with low scores. The findings suggest that sexual trauma may be an important contributing factor in development of psychosis for some individuals.