Extremely low birth weight (ELBW) survivors have higher rates of shyness, a risk factor for poorer outcomes across the life span. Due to advances in fetal and neonatal medicine, the first generation of ELBW survivors have survived to adulthood and become parents. However, no studies have investigated the transmission of their stress vulnerability to their offspring. We explored this phenomenon using a population-based cohort of ELBW survivors and normal birth weight (NBW) controls. Using data from three generations, we examined whether the shyness and parenting stress of ELBW and NBW participants (Generation 2) mediated the relation between the parenting style of their parents (Generation 1) and shyness in their offspring (Generation 3), and the extent to which exposure to perinatal adversity (Generation 2) moderated this mediating effect. We found that among ELBW survivors, parenting stress (in Generation 2) mediated the relation between overprotective parenting style in Generation 1 (grandparents) and child shyness in Generation 3. These findings suggest that perinatal adversity and stress may be transmitted to the next generation in humans, as reflected in their perceptions of their children as shy and socially anxious, a personality phenotype that may subsequently place their children at risk of later mental and physical health problems.