Postpartum psychological functioning impacts both women’s health and outcomes in children. Lower income, ethnic minority women may be at particular risk for adverse postpartum mental health outcomes. Studies link ambient air pollution exposure with psychological dysfunction in adults although this association has not been examined among postpartum women. Methods We studied associations between prenatal exposure to particulate matter with diameter 2.5 μm (PM2.5) and postpartum psychological functioning in a lower income, ethnically mixed sample of urban US women enrolled in a pregnancy cohort study. Analyses included 557 mothers who delivered at 37 weeks gestation. Daily estimates of residential PM2.5 over gestation were derived using a satellite-based spatio-temporally resolved model. Outcomes included the Edinburgh Postnatal Depression Scale (EPDS) score from 6 or 12 months postpartum and subscale scores for anhedonia, depressive and anxiety symptoms. Associations were also examined within racial/ethnic groups. Distributed lag models (DLMs) were implemented to identify windows of vulnerability during pregnancy. Results Most mothers had less than a high school education (64%) and were primarily Hispanic (55%) and Black (29%). In the overall sample, a DLM adjusted for age, race, education, prenatal smoking, and season of delivery, we found significant associations between higher PM2.5 exposure in the second trimester and increased anhedonia subscale scores postpartum. In race stratified analyses, mid-pregnancy PM2.5 exposure was significantly associated with increased total EPDS scores as well as higher anhedonia and depressive symptom subscale scores among Black women. Conclusions Increased PM2.5 exposure in mid-pregnancy was associated with increased depressive and anhedonia symptoms, particularly in Black women.