Parental emotional distress, particularly high maternal anxiety, is one of the most consistent predictors of child anxiety treatment outcome. In order to identify the cognitive, affective, and behavioral parenting characteristics of mothers of children with anxiety disorders who themselves have an anxiety disorder, we assessed the expectations, appraisals, and behaviors of 88 mothers of anxious children (44 mothers who were not anxious [NONANX] and 44 mothers with a current anxiety disorder [ANX]) when interacting with their 7–12-year-old children. There were no observed differences in anxiety and avoidance among children of ANX and NONANX mothers, but, compared with NONANX mothers, ANX mothers held more negative expectations, and they differed on observations of intrusiveness, expressed anxiety, warmth, and the quality of the relationship. Associations were moderated by the degree to which children expressed anxiety during the tasks. Maternal-reported negative emotions during the task significantly mediated the association between maternal anxiety status and the observed quality of the relationship. These findings suggest that maternal anxiety disorder is associated with reduced tolerance of children's negative emotions. This may interfere with the maintenance of a positive, supportive mother-child interaction under conditions of stress and, as such, this may impede optimum treatment outcomes. The findings identify potential cognitive, affective, and behavioral targets to improve treatment outcomes for children with anxiety disorders in the context of a current maternal anxiety disorder.