Youth in child welfare settings exhibit high rates of externalizing behavior disorders, which place them at increased risk for placement disruptions. These placement disruptions are linked to further increases in externalizing problems. Given these mental health concerns and also the economic constraints of child welfare settings, there is a need for reliable, valid, and efficient measures of externalizing behavior problems. The Parent Daily Report (PDR) is one particularly promising measure of problematic child behaviors. It is a 31-item parent observation report of behavior problems such as defiance, fighting, and arguing. The present investigation represents the first large-scale, systematic examination of the psychometric properties of the PDR using a diverse child welfare sample. The sample consisted of 700 children (52% female) between the ages of 5 and 12 years (M = 8.8 years) who were placed in relative or nonrelative foster care in San Diego County between 1999 and 2004, and whose caregivers participated in an effectiveness trial of a parent management training and support intervention. The first study aim was to examine the factor structure of the PDR using exploratory factor analysis, which uncovered a two-factor structure. The second and third aims were to compare the factor structure across language and gender. Multiple group analysis across language revealed partial equivalence between the English and Spanish versions of the PDR. Multiple group analysis across gender revealed an equivalent factor structure for males and females. The final study aim was to determine whether the PDR could be used to identify distinct subgroups of children. Latent class analysis supported a three-class solution, based on the severity of behavioral disturbance (i.e., low, moderate, severe). These findings collectively suggest that the PDR has sound psychometric properties when used with a diverse child welfare sample. Further, the measure is clinically valuable in that it can be used to identify youth that are at high risk for placement disruptions and escalation of externalizing problems. Additional implications for assessment, treatment, and future research in child welfare settings are discussed.