Little is known about the impact of family history of psychosis on youth from community samples. To fill this gap, we compared youth with a first-degree relative with psychosis spectrum symptoms (i.e. family history of psychosis spectrum symptoms, FHPS) to youth without FHPS in a cross-sectional analysis of the Philadelphia Neurodevelopmental Cohort (PNC). The PNC is a racially diverse community sample of 9498 youth ages 8–21 years old, of whom 8928 completed the Family Interview for Genetic Studies to determine FHPS status. Polygenic risk score for schizophrenia (PRSS) was available for a subsample of 4433 European Americans. FHPS youth (n = 489) constituted 5.5% of the analytic sample. After adjusting for environmental risk factors (sociodemographic variables and traumatic stressful events), FHPS youth had lower functioning on the Children’s Global Assessment Scale and elevated psychosis spectrum, mood, externalizing, and fear symptoms compared to non-FHPS youth (all p < .001). In the European-American subsample, FHPS status was associated with poorer functioning and greater symptom burden in all four psychopathology domains (all p < .001), even after covarying for PRSS. Thus, ascertaining FHPS is important because it is uniquely associated with symptoms and functional impairment in community youth beyond PRS-S and the environmental risk factors we investigated. Future research identifying environmental causes of FHPS-associated impairment could inform the development of interventions for the broad array of symptoms observed in FHPS youth.