Childhood trauma is associated with many long‐term negative outcomes, and is not limited to the individual experiencing the trauma, but extends to subsequent generations. However, mechanisms underlying the association between maternal childhood trauma and child psychopathology are not well understood. Here, we targeted frontal alpha asymmetry (FAA) as a potential underlying factor of the relationship between maternal childhood trauma and child behavioral problems. Electroencephalography (EEG) was recorded from (N = 45) children (Mean age = 57.9 months, SD = 3.13) during an eyes‐closed paradigm in order to evaluate FAA. Mothers reported on their childhood trauma experiences using the Childhood Trauma Questionnaire (CTQ), and on their child's behavior using the child behavior checklist (CBCL). We found that maternal childhood trauma significantly predicted child total, internalizing, and externalizing behavior at age 5 years. We also observed a role for FAA such that it acted as a moderator, but not mediator, for behavioral problems. We found that children with relative more right/less left frontal activity were more at risk to develop behavioral problems when their mother had been exposed to trauma in her childhood. These results indicate that child frontal asymmetry may serve as a susceptibility marker for child behavioral problems.