The synthetic estrogen, 17α-ethinylestradiol (EE2) is a ubiquitous endocrine disrupting chemical (EDC) in the aquatic environment and can impede the embryonic and larval development of oysters. However, it remains elusive whether parental (F0) exposure to EE2 can modulate these processes in the unexposed F1 offspring through transcriptomic regulation. In this study, we assessed the effect of parental exposure of the Sydney rock oyster (Saccostrea glomerata) to EE2 at an environmentally relevant concentration (50 ng/L) for 3 weeks. We observed that the parental exposure reduced the survival and fitness of D-veligers at 1 and 2 dpf, respectively, and caused shell length reduction in 7 dpf larvae. The transcriptional response of the unexposed larvae was assessed through RNA sequencing. A total of 1,064 differentially expressed genes (DEGs) were found in larvae from parents of both sexes treated (FTMT) while fewer numbers of DEGs, 258 and 7, were detected in larvae from the maternal (FTMC) and paternal (FCMT) alone treatment groups, respectively. Subsequent qPCR verification of selected DEGs indicated that genes related to ATP synthesis/energy regulation/mitochondrion membrane functioning (ATP5F1D, ATP5MF, EMRE, TIM44, and UQCRFS1), larval growth and development (CHPF), gene transcription/promoter responses to various activators and repressors (TAF6), and antioxidant defence against oxidative stress (Ec-SOD) were significantly downregulated. Furthermore, gene ontology (GO) analysis revealed significant enrichment of DEGs concerning with various biological, cellular and molecular functions, with pronounced effects observed in the FTMT and FTMC treatment groups. A similar pattern was also observed in the KEGG pathways analysis. Overall, the transcriptomic adjustments observed in this study provide important mechanistic insights into the phenotypic traits of oyster larvae derived from parental exposure to EE2.