Children who suffer from frequent nightmares or bouts of night terrors may be at an increased risk of mental illness in adolescence, a new study said Friday.

The study, published in the U.S. journal SLEEP, showed that children reporting frequent nightmares before the age of 12 were 3. 5 times more likely to suffer from psychotic experiences in early adolescence.

Similarly, experiencing night terrors doubled the risk of such problems, including hallucinations, interrupted thoughts or delusions, it said.

Younger children, between two and nine years old, who had persistent nightmares reported by parents had up to 1.5 times increased risk of developing psychotic experiences.

Nightmares are considered to be commonplace in young children with incidence reducing as they grow older. They occur in the second half of sleep during rapid eye movement (REM) sleep. Those who have experienced them will be familiar with the sensation of waking suddenly with a sense of fear, worry and possible palpitations.

Night terrors, a sleep disorder, differ from nightmares and occur during deep sleep (non-REM) cycles in the first half of the night. A night terror bout is often signified by a loud scream and the individual sitting upright in a panicked state, though unaware of any of the involuntary action. The thrashing of limbs and rapid body movements are witnessed in more extreme cases. Children wake up in the morning unaware of their activity throughout the night.

"We certainly don't want to worry parents with this news; three in every four children experience nightmares at this young age," lead author Dieter Wolke, professor of the University of Warwick, said in a statement.

"However, nightmares over a prolonged period or bouts of night terrors that persist into adolescence can be an early indicator of something more significant in later life," Wolke said.

The researchers advised parents to create an environment that allows for the best possible quality of sleep for their child.

"Diet is a key part of this, such as avoiding sugary drinks before bed," co-author Helen Fisher of King's College London said. "But at that young age we'd always recommend removing any affecting stimuli from the bedroom -- be it television, video games or otherwise. That's the most practical change you can make. "

The researchers said the study is important because an early warning sign may lead to early intervention that is crucial to help avoid children suffering mental illness when they reach adulthood.