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Paternal imprisonment is generally associated with poor educational outcomes and with education being one of the most central stratifying factors in most developed democracies paternal imprisonment has the potential to transmit and enhance intergenerational disadvantage. Yet, the consequences of parental imprisonment for children’s educational outcomes are still unclear. In this study I estimate the causal effect of paternal imprisonment on children’s educational outcomes measured by the end of compulsory schooling. I use Danish administrative data, and for causal inference, I exploit a change in sentencing policy in 2000, which provides plausibly exogenous variation in the risk of experiencing paternal imprisonment. This policy change expanded the use of non-custodial alternatives to prison for traffic offenders. I find that paternal imprisonment does not have an effect on children’s grade point average. However, completing compulsory education on time and obtaining a full set of grades are causally affected by paternal imprisonment. Paternal imprisonment increases the risk of finishing 9th grade minimum two years late and decreases the proportion of grades obtained and the proportion of grades passed. Results also show that effects on these educational outcomes are driven by the boys in the sample.