Substance abuse and dependence are among the most common psychiatric disorders among pregnant and parenting women. These disorders among welfare recipients have attracted special concern. Chemical testing has been proposed to identify illicit drug use in this population. This analysis scrutinizes the potential value of drug testing, using recent data from the Women's Employment Study and the National Household Survey of Drug Abuse. One-fifth of recipients reported illicit substance use during the previous year. However, less than 5% satisfied diagnostic screening criteria for illicit drug dependence. Most recipients with psychiatric disorders or alcohol dependence reported no recent illicit drug use, and, thus, would not be detected through chemical tests. Although illicit drug users are rarely dependent, many face barriers to self-sufficiency. Screening and assessment programs should distinguish use from dependence, and should also identify alcohol dependence and psychiatric disorders. States should provide a range of treatment services to address these concerns.