The goal of this study was to characterize the contemporaneous and prognostic relationship between symptoms of separation anxiety disorder (SAD) and associated functional impairment. The sample comprised n=2067 8-16-year-old twins from a community-based registry. Juvenile subjects and their parents completed a personal interview on two occasions, separated by an average follow-up period of 18 months, about the subject's current history of SAD and associated functional impairment. Results showed that SAD symptoms typically caused very little impairment but demonstrated significant continuity over time. Older youth had significantly more persistent symptoms than younger children. Prior symptom level independently predicted future symptom level and diagnostic symptom threshold, with and without impairment. Neither diagnostic threshold nor severity of impairment independently predicted outcomes after taking account of prior symptom levels. The results indicate that impairment may index current treatment need but symptom levels provide the best information about severity and prognosis.