Reciprocal influences of substance abuse and family functioning have been hypothesized from diverse theoretical perspectives. The longitudinal study presented here investigated the relationship between adolescent alcohol and drug use outcome and family functioning following adolescent substance abuse treatment. Consistent with predictions, long-term improving teens (n = 17) experienced better family relations, and less conflict-related behavior within the family, than did teens who returned to an abuse pattern of drug use (n = 37). Two years following treatment, families of improvers demonstrated greater cohesion and expressiveness, and less conflict, than did families of relapsers. Findings highlight a gradual process of adaptation in relations among families of teens treated for alcohol and drug abuse.