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The current study explored relations among American Indian children’s chronic physiological stress levels as indicated by hair cortisol, posttraumatic stress disorder arousal symptoms, and executive function. Executive functions serve an important regulatory role in behavior with good executive function related to better impulse management, sound decision-making skills, and even improved health (e.g. Allan et al., 2016; Best et al., 2011; Zelazo & Cunningham, 2007). Research has demonstrated a link between high levels of chronic physiological stress and impaired executive function (Blair, 2010). Additionally, research has shown that persons with posttraumatic stress disorder (PTSD) have impaired executive function (Polak et al., 2012), and in particular, arousal symptoms is closely linked to executive dysfunction (Leski & White, 2007). American Indians have not been included in these studies despite the high prevalence of PTSD in this population (Bassett et al., 2014). Moreover, no studies to date have explored relations among chronic physiological stress, PTSD, and executive function in American Indian children. We hypothesized that higher levels of chronic physiological stress would increase posttraumatic stress disorder arousal symptoms, which would then lead to impaired executive function. A total of 170 urban American Indian children between 8- to 15- years old participated in the study (M = 10.57, SD = 1.90). The results demonstrated that posttraumatic stress disorder arousal symptoms fully mediated the relation between chronic physiological stress and executive function. In other words, higher levels of chronic physiological stress predicted poorer executive function through increased PTSD arousal symptoms. This finding has broad implications for intervention and prevention efforts to promote positive development among American Indian youth who are at heightened risk for negative developmental outcomes. Interventions must start early in order to reduce the negative effects of physiological stress on mental health and cognitive functioning. More importantly, prevention efforts are needed to ensure all children have equal access to educational success and well-being.