Objective: To examine the effects of paternal depression during children’s first year on their wellbeing at 4–5 years of age using a large, representative sample of Australian families. Design, setting and participants: Prospective study of Australian families from 2004 to 2008. Two-biological-parent families (n =2620) from the Longitudinal Study of Australian Children were included if depression measures were available for both parents in 2004, behavioural and developmental measures were available for children in 2008, and the families had not separated by 2008. Main outcome measure: Child scores on the Strengths and Difficulties Questionnaire and on a set of Derived Outcome Indices, measured when the child was 4–5 years old. Logistic regression modelling was used to investigate how early paternal depression in 2004 influenced child outcomes 4 years later. Results: Early paternal depression was a significant predictor of a range of poorer child outcomes (odds ratio [OR] for behavioural difficulties, 3.34 [95% CI, 3.06– 3.65]; OR for a low development and wellbeing score, 2.70 [95% CI, 2.44–2.98]). These effects remained significant after controlling for both early maternal depression and later paternal depression (adjusted OR for behavioural difficulties, 1.93 [95% CI, 1.75–2.14]; OR for a low development and wellbeing score, 1.65 [95% CI, 1.48–1.85]). Conclusions: Depression in fathers during the first year of a child’s life can have a detrimental impact on their child’s behaviour, and social and emotional development at the point of school entry, in addition to and uniquely compared with depression in mothers. Early intervention to identify and address the mental health needs of fathers is required for the benefit of fathers, children and families.