Exposures to environmental toxicants can have both immediate and long-term impacts, including those that persist into the next generation. Using Gulf killifish (Fundulus grandis), we tested whether adult progenitor exposure to crude oil caused perturbations to larval morphology and embryonic genome-wide gene expression in their first- and second-generation descendants raised in clean water. We also tracked responses of additional direct oil exposures in the F1 and F2 embryos. Exposure to oil in progenitor fish caused altered larval morphology in F1 and F2 descendants. Some perturbations were enhanced by additional oil exposure in lineages with progenitors that had been exposed to oil. Progenitor exposures altered embryonic gene expression in F1 and F2 descendants, implicating impacts on neurological and cardiovascular systems. Molecular responses to progenitor exposure were distinct between F1 and F2 offspring, suggesting complex interactions between mechanisms that contribute to the transgenerational transfer of information. In contrast, molecular responses to additional direct oil exposures during early-life development were highly conserved between generations and between progenitor exposure treatments. We conclude that exposure to crude oil causes developmental perturbations that propagate at least two generations, and we present additional hypotheses about underlying molecular mechanisms and emergent health consequences.