This paper presents the first estimates of school-level intraclass correlation (ICC) for smoking-related variables from an urban and largely African American population. Seventh graders (n = 6967) from 39 middle schools in Memphis, TN, were measured at baseline in 1994 and annually through 1997. Mixed model regression methods were used to estimate variance components for school and residual error. School-level ICCs were large enough, if ignored, to substantially inflate the Type I error rate in an analysis of treatment effects. We show how those correlations can be reduced using regression adjustments and used to determine sample size for future school-based smoking prevention studies.