Children with life-threatening medical illnesses and their parents are at risk for the development of clinically significant symptoms of post-traumatic stress disorder (PTSD). Contrary to medical assumptions, symptom development seems to be related to the child's or parents' appraisal of risk, rather than the actual prognosis of the illness. In palliative care contexts, appraisal of risk and PTSD symptoms should be assessed in children and parents, and appropriate interventions should be initiated.