In the current study, we compared emotion regulation abilities between post‐institu‐ tionalized (PI; N = 124) and never‐institutionalized non‐adopted (NA; N = 172) chil‐ dren and adolescents (7–15 years). We assessed cortisol reactivity and coded emotion regulation during the speech portion of Trier Social Stress Test (TSST‐M). Parents reported on their children’s social, academic, and behavioral adjustment. Results sug‐ gest that emotion regulation abilities increased with age, but this increase was greater for NA than PI youth. With regard to cortisol, piecewise growth modeling revealed that at higher levels of emotion regulation PI youth had greater baseline values (after a period of time allowing for acclimation to the laboratory) and had steeper recovery slopes than NA youth. There was also a main effect of emotion regulation on the re‐ activity slope suggesting that for both groups, as emotion regulation increased, the cortisol reactivity slope decreased. Finally, greater emotion regulation predicted fewer internalizing behavior problems for PI youth but not for NA youth.